There are ways to avoid wage garnishment in Vermont.
Summary: Vermont is among the few states that require creditors to garnish only 15% of a debtor's wages for consumer credit transactional debt. This requirement and other laws protect the consumers and ensure they can challenge a garnishment order. You can avoid wage garnishment when you settle your debt with the help of SoloSettle.
Wage garnishment in Vermont occurs when a creditor collects a debt by taking a portion of your wages directly from your employer. This process happens after a creditor obtains a court order through a judgment against the debtor.
The wage garnishment process begins when you fail to pay a debt, such as a credit card bill, medical bill, or personal loan. The creditor then files a debt collection lawsuit and wins the case, giving them the right to collect the debt through various means, including wage garnishment.
However, debtors in Vermont do have options to fight a wage garnishment. You can object to the order, file a claim of exemption, or negotiate with creditors. Keep reading to learn about these options in detail. But before we dive into it, let's look at the wage garnishment laws in Vermont.
Vermont protects its citizens from undergoing excessive or unfair wage garnishment using state laws (12 V.S.A. § 3166–3172) and federal laws (15 U.S. Code § 1671–1677). The most significant regulations that apply to your current situation include the following:
The law puts limits on wage garnishment
Under federal law, wage garnishment is limited to 25% of your disposable earnings, or the amount by which your weekly disposable earnings surpass 30 times the federal minimum wage. Moreover, Vermont state law is more restrictive, limiting wage garnishment to 15% of your gross earnings or 40 times the federal minimum hourly wage—if it is from a consumer credit transaction.
Let's illustrate with an example:
Example: Maxine owes $10,000 to Express Credit, and the company obtained a court order allowing them to garnish her wages. Maxine's gross weekly earnings are $1,000 after deductions. Under federal law, 25% of $1000 is $250, while in Vermont law, 15% of $1000 is $150. Hence, the amount that Express Credit can take from Maxine is $150.
You may be exempt from wage garnishment
Vermont law protects income such as social security benefits, veteran benefits, disability benefits, and workers' compensation payments. These earnings are considered special because of the underlying reasons behind the provision.
Vermont law requires that a debtor be notified of a wage garnishment before it takes effect. The notice must include information about the debt, the garnishment amount, and your right to challenge the garnishment.
Limits on Employers
Vermont law (12 V.S.A. § 3172) prohibits employers from firing or discriminating against an employee whose wages are undergoing garnishment. Besides, employers must comply with all wage garnishment orders and can be held liable for failing to do so.
With these laws in mind, you can increase your chances of successfully challenging the garnishment order. Let's look at legal ways to accomplish it.
Object to the wage garnishment
Vermont allows its citizens to object to wage garnishment and avoid having their wages undergo illegal and unjust garnishment. Here are some reasons you can use:
You do not owe the debt in the order, or you paid the creditor, and they haven't updated their records.
The debt amount is incorrect, affecting the amount to be garnished.
The garnishment amount exceeds the legal limit under state or federal law.
You are going through financial hardship.
Once you choose the reason that fits your situation, file the objection with the court that issued the garnishment order and wait for a hearing to argue your case.
If you have other pending debt, take action before the creditor gets a garnishment order by responding with an Answer document immediately after you receive the first debt collection lawsuit letter. Here is George explaining how to draft an exceptional Answer.
File a claim of exemption
A claim of exemption allows you to object to the wage garnishment and asks the court to review the garnishment order and adjust the amount or eliminate the order. Sometimes, a creditor may want to garnish money that the law legally prohibits, for example:
If your income is beneath the poverty line
The government protects your income (veterans, retirement, and disability benefits)
More than 50% of your earnings support the household
The creditor’s calculation is inaccurate and thus exceeds the legal limit
After the judge hears and reviews your case, they will reduce, eliminate, or retain the garnishment order.
Negotiate with the creditor
The strict state and federal laws often make creditors dislike taking the garnishment route. Hence, you can ask them if they are willing to negotiate with you to settle the debt for less than you owe. When they agree, you must clear the entire debt, make a lump sum payment, and clear the remaining balance faster. This process is known as debt settlement.
SoloSettle makes debt settlement simple
Debt settlement companies can be expensive, time-consuming, and even scammy. Luckily, you can work out a debt settlement on your own with the help of SoloSettle.
SoloSettle, powered by SoloSuit, is a tech-based approach to debt settlement. Our software helps you send and receive settlement offers until you reach an agreement with your creditor or debt collector.
Here are a few features that make SoloSettle unique:
You can settle debts of any size with SoloSettle. Many debt settlement companies require you to have a debt over $15k.
SoloSettle actively attempts to settle your debt, whereas many debt settlement companies take a more passive role, waiting for settlement offers to come to them.
SoloSettle is offered by SoloSuit, a trusted brand and a legitimate company. Many traditional debt settlement companies are actual scams.
SoloSettle has legal defense built in with SoloSuit. While settling, you can use SoloSuit to block lawsuits if you need. Most debt settlement companies don’t provide legal defense; if you’re sued for a debt you are on your own.
To learn more about how SoloSettle can help you settle your debt and avoid wage garnishment, check out this video:
You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt.
SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.
And 50% of our customers' cases have been dismissed in the past.
"Finding yourself on the wrong side of the law unexpectedly is kinda scary. I started researching on YouTube and found SoloSuit's channel. The videos were so helpful, easy to understand and encouraging. When I reached out to SoloSuit they were on it. Very professional, impeccably prompt. Thanks for the service!" - Heather