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Retrieving Debt Through Wage Deductions

 Posted on April 05,2017 in Debt Collection

How to Use Wage Deduction Against DebtorsOf the many means creditors can use to collect debt, wage deduction is considered the final option when all other methods have failed. The process involves working with the debtor’s employer to have money deducted from the debtor’s wages to pay to the creditor. It is often called wage garnishment, but garnishment can actually refer to a separate legal action that takes money from debtor monetary sources other than wages, such as bank accounts and money owed to the debtor. If a creditor is seeking money through a wage deduction, there are legal procedures they must follow.

Filing for Wage Deduction

Before filing a Wage Deduction Affidavit in court, the creditor must notify the involved parties:

  • Debtors must receive a wage deduction notice, explaining how much money can be deducted from their wages and their right to a hearing to dispute that amount.
  • Creditors must give the debtor’s employer a set of questions called interrogatories to determine how much money the debtor will earn in wages and how much can be deducted.

Determining Amount

Illinois law uses a formula to determine how much can be deducted from a debtor’s wages. Creditors can deduct the lesser of:

  • 15 percent of the debtor’s wage, or
  • 45 times either the federal or state minimum wage, whichever is greater.

The rest of the debtor’s wage is considered exempt, as well as any employee benefits and refunds from retirement plans. If the debtor makes little enough money as a weekly wage, the creditor may not be allowed to deduct anything.

Obtaining Deductions

Once the affidavit and employer interrogatories are filed, the employer must withhold the debtor’s non-exempt wages until the court can determine whether the creditor should receive the deduction. If the court affirms the wage deduction, the creditor will receive deduction payments until the debt is paid or the debtor leaves the employer. If the debtor does not earn enough in wages for money to be legally deducted, the court can order future deductions to start once the debtor is earning enough.

Debtor’s Rights

If debtors think that too much money is being deducted from their wages, they can request a hearing to determine the proper amount. Debtors are also protected by law from employers firing them because a creditor is deducting from their wages. However, if more than one creditor starts taking deductions, the debtor is no longer protected.

Creditor’s Rights 

If a debtor will not pay you the money you are owed, you may have to fight in court to retrieve that debt. A Chicago debt collection lawyer at Dimand Walinski Law Offices, P.C. knows all the legal tools at your disposal.


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