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What to Do If You're Facing Wage Garnishment and How to Stop it

What to Do If You’re Facing Wage Garnishment and How to Stop it

When you have missed payments on your debts or have defaulted on your loans, creditors will want to request a garnishment order. The good news is that a wage garnishment order may be stopped at any point while it is being implemented.

A wage garnishment is an official legal action taken by the creditor.  If your creditor accepts to pull back the garnishment, a garnishee will only be stopped through a related legal process. Before receiving full payment, most creditors are hesitant to have a garnishment order lifted.

It’s also crucial to be aware that your employer must abide by a garnishment order unless they obtain a letter by the court order, such as one approving them to stop garnishing your wages due to bankruptcy or a proposal from the court, called a stay of proceedings.

What is a Wage Garnishment?

The court may order a wage garnishment if you don’t pay your debts, taxes, or child support. Due to this order, your employer is required to pay your creditors up to 50% of your take-home pay. This is frequently referred to as having one’s wages garnished. 

Who is capable of garnishing my wages?

Anyone with unpaid debts is subject to garnishment actions by any creditor. Wage garnishments can be used to enforce collection by collection agencies like the CRA, credit card companies, the Court, payday loan lenders, or any other creditor.

What is the process of a garnishment?

What is the process of a garnishment

A lender would first file a Statement of Claim before they could garnish your wages. From the day the claim was mailed, you, as the debtor, have 21 days to respond and then either file a Statement of Defense to argue the debt or to inform the creditor of an error. The court will presume that you have accepted the debt if you don’t respond, and the lender will be given a Garnishment Order.

Not all creditors must first seek a garnishment order in court. Without filing a lawsuit first, the Canada Revenue Agency can seize money from your bank account or garnish your wages. Similar to payday loan companies, credit unions can garnish your wages if you’ve signed a voluntary wage assignment giving them the right to do so if you stop making payments.

How much of my wages can be garnished?

The maximum amount of gross wages that can be withheld by a creditor under the Ontario Wages Act is 20% for debts and 50% for child support.

How to stop wage garnishments

Nobody wants to put in a lot of effort only to have their paycheck cut in half by a collector. If your debt has gotten to this point, assistance is available. You can talk to us at EmpireOne Credit Solutions to learn about your options. Depending on your circumstance, you might think about:

1. Making payment arrangements with your creditors

A Debt Management Program (DMP) combines all of your qualifying debts into one. This makes managing debts and making payments much simpler.

It’s a great resource to get advice on managing personal finances from a professional. The benefit of this is that in addition to paying off your debt, you also learn how to manage your money better in the future.

2. Consumer proposal

A consumer proposal is a great option if you are looking to reduce your debt by up to 80%. Additionally, it also implies that you get more time to pay off your debt, as a consumer proposal has up to a five-year time frame and you get to keep your assets, and most importantly stop all interest. This will also stop a wage garnishment or any legal action taken against you from your creditors.

3. Filing for bankruptcy

It is usually considered as a last resort but could give you that fresh start you are looking for. Bankruptcy stops all court actions or garnishments immediately, but keep in mind that this stays on your credit for a minimum of 7 years.


Act quickly to stop losing a portion of your next paycheck if you are facing a wage garnishment.  A consumer proposal or personal bankruptcy may be used to stop a garnishment, immediately.

Filing for bankruptcy

You should attempt to reach out to a debt expert for advice before a creditor serves your employer. Saving you time and embarrassment and loss of wages. 

You could lose more of your income the longer you wait to address the wage garnishment. Get in touch with EmpireOne Credit Solutions right away, for a free consultation!

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