As to the effect of a bankruptcy upon the individuals accounts and judgments, I would encourage you to consult with a bankruptcy attorney who will be able to review your obligations with you, counsel you on your legal options and what type of bankruptcy you qualify for. Most bankruptcy attorneys will consult with you without cost or obligation, so this is what I would suggest as an initial matter.
As for the impact on your credit report, a fresh start in bankruptcy will have both a positive and negative impact on your credit standing. Of course, the bankruptcy will appear on your credit report, and this will be a derogatory item that will drive down your credit score. Over time, your score will presumably improve as the delinquent accounts become older, and your debt obligations will be greatly diminished. (This is true provided you make payments on time and take steps to rebuild a positive credit history).
If you file a Chapter 7, the account on your credit report will still reflect the prior account history; so negative information will still report. But the status will show the obligation was discharged in bankruptcy, so you are no longer liable for this. And the amount due and owing would show: $0.00. Since your debt to available credit ratio is big factor in credit scoring, this will benefit your standing.
A credit account will not be removed for 7.5 years from the date of delinquency. And the bankruptcy will continue to report for 10 years from the date of filing, or the order of relief.
I hope this helps. Good luck to you!
NOTE: This Answer does not constitute legal advice. Every case is fact specific. To render a legal opinion, an attorney must engage in a consultation with a prospective client and review any pertinent documents. This communication does not create an attorney-client relationship with Attorney Amy L. Wells or WELLS LAW OFFICE, INC.
Generally speaking, you can stop a wage garnishment even if it is currently taking place by filing a a bankruptcy. A bankruptcy will show on your credit history for 10 years after date of filing.
As for your credit report; a bankruptcy starts the rebuilding process asap. On the path you're on, the credit rebuilding doesn't start until all your debts are settled.
Best of luck,
Sanjay A. Paul, Esq.
This is not legal advice. No attorney client relationship exists between us.
Filing bankruptcy will stop a wage garnishment. In addition, you can claim return of garnishment collected during the 90 days prior to filing the bankruptcy. Consult a local bankruptcy attorney to answer all of your questions in detail.
No attorney client relationship is established until both parties sign a retainer agreement. The questioner is advised to hire a lawyer to address this issue and obtain complete legal advice.
In addition to my colleagues' previous answers, not only will filing a bankruptcy stop the current garnishment the day you file, it will also prevent garnishment by the other creditors who are already "waiting in line". I suggest you consult with a bankruptcy attorney to discuss your situation. From the information you have given, it sounds like bankruptcy might be a good option for a fresh start.
IMPORTANT LEGAL NOTICE: Ms. Moriarty's response set forth above is not legal advice and it does not create an attorney-client relationship. Ms. Moriarty's responses to all questions posted on AVVO are intended to provide general information based upon her understanding of the facts stated in the question, and are for the general educational purposes of the public, not any specific individual. Also, a particular case may involve additional facts and circumstances which might invalidate some or all of the concepts provided in this answer and therefore you should not rely upon this answer in any individual situation. In order to offer legal advice about this or any similar situation, a qualified attorney would likely need to consider many factors not stated in the question and would need to question the potential client in order to clarify the specific facts operable in that case. If you would like to obtain specific legal advice about this issue, it is recommended that you contact an attorney in your state. Ms. Moriarty is licensed to practice law in the State of Ohio and in the U.S. Bankruptcy Court, Southern District of Ohio. She practices mainly in Franklin and surrounding counties, and may be contacted directly via email at: email@example.com.