Can I get my money back that has already been garnished?
There are occasions where I get phone calls from potential clients where either a bank account has been “frozen” or money has been seized by a creditor out of their account or their wages have been garnished out of their paycheck.
This can lead to a very dire situation if you are living paycheck to paycheck and money that you are counting on to buy groceries or pay rent is now gone. When that occurs, our first step is to analyze whether the creditor appropriately garnished your wages or bank account. For example, if the source of the money in your bank account is social security funds, those funds would be exempt from garnishment.
If that is the case, you might be able to file a claim of exemption in the underlying case to see if the judge would reverse the garnishment order and “unfreeze” those funds.
Filing for bankruptcy will immediately stop any collection efforts in the future. If the creditor was entitled to the garnished funds, they are not required to retroactively reimburse you for those funds that were taken before you filed your bankruptcy case. If the creditor garnishes anything after you file your bankruptcy case, you would be entitled to get those funds reimbursed.
Whenever you get served with a lawsuit, it is important to speak with an attorney as soon as possible to determine if you do have any exemptions to the garnishment and to discuss the best timing for filing your bankruptcy case. That way the situation can be handled to ensure that you prevent a garnishment.