Situation: You wake up Friday morning, it is payday, and it is going to be a good day. You check your bank account, realize there is money missing (your paycheque was only a portion of what it should have been), so you do some research and find out your wages have been garnished. So long good day…

If a creditor or the Canada Revenue Agency is trying to garnish your wages (or has already leveraged a garnishment) you can stop it. Here are some things you need to know.

Whether you owe a creditor or the CRA, your wages can be garnished. The only major difference between creditor garnishments and CRA garnishments is that a creditor needs to get a court order to garnish your wages and the CRA does not. (The creditor will have to sue you and win his case to get that order.) At that point, the process is fairly simple; once a court order is obtained, a letter is sent to your employer (or your clients if you are self-employed), and they are required by law to take a portion, sometimes up to 50%, and send it to the court.

When a creditor garnishes you, your options are to pay your debt, make a motion to the court asking to set aside the garnishment and make monthly payments, get your creditor to agree to a voluntary monthly arrangement or deploy a federal government program to stop your creditor.

When the CRA garnishes you, your options are to pay your debt, get the CRA to agree to a monthly payment arrangement or deploy a federal government program to stop your creditor.

What is a federal government program?

• There is a law called the Bankruptcy and Insolvency Act which offers various protections to people with serious financial problems.
• Not all protections in the Act involve bankruptcy – there is also a consumer proposal option which is similar to a debt consolidation.

Protection under this Act may mean that:

• Your creditor or the CRA has to remove the garnishment
• Interest will stop
• The debt may be reduced
• You will have a single monthly payment

How do you begin the process of applying for protection under this Act? These are formal processes that need to be carried out correctly the very first time. Your best approach is to speak with a financial consultant to discuss the various options available to you, one with the knowledge and experience leveraging these programs to help individuals deal with wage garnishments.

Stopping a wage garnishment once it has been put in place may seem impossible – but trust us, it is not. Call DebtCare today at 1-888-890-0888.