Garnishment in Minnesota

 

I’m confident in saying that having your bank account or paycheck garnished by a debt collector is one of the most stressful financial situations you can face. Your bank account is frozen. Your paycheck is much smaller than expected. And your bills don’t stop just because of the garnishment.

This page explains how garnishment works in Minnesota, what can and can’t be taken, how to stop it, and when a creditor’s actions cross the line.

What Is Garnishment?

Garnishment is a legal process where a creditor takes money directly from your paycheck or your bank account.

In Minnesota, wage garnishment generally allows a creditor to take up to 25 percent of your disposable earnings, depending on your income level. The good news is that the creditor must notify you first.

A bank garnishment, on the other hand, comes without any warning and freezes all of the money in your account. This often triggers overdraft fees and bounced checks or electronic payments.

How Garnishment Starts

Once a creditor obtains a court judgment, it may serve a garnishment summons on your employer or your bank. Although Minnesota law allows for pre-judgment garnishment in limited cases, in my experience, virtually all consumer debt garnishments come after judgment.

For a wage garnishment, the creditor must give you at least 10 days notice before taking money from your paycheck. For bank garnishments, however, no notice is required. They creditor can freeze your bank account without warning and you won’t get notice until after the money is held.

Can Garnishment Be Stopped?

Sometimes.

Depending on the circumstances, you may be able to reduce or stop garnishment by claiming legal protection for the money in your bank account or paycheck. In Minnesota, these legal protections are called “exemptions.”

You might also be able to stop the garnishment by negotiating a settlement, challenging the underlying judgment, or filing bankruptcy. Bankruptcy, if appropriate, can immediately halt garnishment through the automatic stay.

The right approach depends on your larger financial picture. In some situations, addressing the single garnishment is the way to go. In others, especially where multiple debts are involved, a broader solution like bankruptcy is more practical.

Claiming Exemptions in Minnesota

Not all money can be garnished.

Minnesota law protects certain categories of income and assets. Most need-based public assistance is completely exempt. A portion of your wages is also protected. The protected amount depends on your income, but is usually at least 75%.

Unfortunately, exemptions aren’t automatic. You must assert them and provide proof by specific deadlines. Waiting can complicate the process and increase the financial disruption that garnishment inherently causes.

When Garnishment Becomes Wrongful

In my experience, creditors and debt collectors don’t always follow the proper garnishment procedures.

Over the years, I’ve seen wrongful garnishment cases where the collector garnished more than they legally could, garnished even after the judgment was fully-satisfied, or even garnished the wrong person. In these situations, my focus shifts to holding the offending creditor liable for its illegal garnishment, typically by using the Fair Debt Collection Practices Act or other consumer protection laws.

Garnishment and Bankruptcy

Sometimes garnishment is a symptom of a larger problem. If you have multiple debts in collections, stopping one garnishment may not restore your financial stability.

Bankruptcy immediately stops wage and bank garnishments and discharges all qualifying debts. Bankruptcy is not right for everyone, but in the right circumstances it is most efficient way to get out from under a garnishment.

In Minnesota and ready to talk to a lawyer about a garnishment?
Schedule a consult with debt defense lawyer Todd Murray.

Since 2009, I’ve helped hundreds of Minnesotans defend debt collection lawsuits. My work has saved my clients millions of dollars and many sleepless nights. My clients have described me as “a clear communicator,” “a man of integrity,” and “very professional.” I live in Minneapolis with my wife and four children.

Schedule a consult with Todd