Posted by Elisabeth Leamy, Tue Mar 01 2011, 12:49AM

Message: My husband and I are in our sixties

Message: My husband and I are in our sixties. He was a contractor, saw what was coming and went back to school for a year to become a teacher. We took a second on the house and obtained a couple of student loans. When we came up short and the end of the year we used our credit cards when we calculated how quickly they could be paid off with my 22.00 an hour job. After refusing to do something illegal for my boss, I was \\\'outsourced\\\'. I have had a succession of lower paying jobs and have now been reduced to one part time job paying 9.30 per hour. My husband is working and we are able to make a house pmt (barely) monthly along with a car pmt on a used car. We have not been able to pay on credit cards for over a year and I live in fear of garnishment which would definately be the end of our small house. Any suggestions?

--Credit card companies can't garnish people's wages, can they? Unless there is some sort of legal settlement allowing them to? I would like to put her mind at ease…

Yes, credit card companies can garnish wages if they have gone to court, and received a judgment against the individual allowing for garnishment. I attached one story from; another page from Wikipedia…
How wage garnishment works -- and how to avoid it
Ignoring credit card debt can lead to garnished wages
By Julie Sherrier and Cynthia Diaz
Ignoring outstanding credit card debt can take a bite out of your paycheck. Wage garnishment -- a last ditch effort at debt collection -- hits debtors where it hurts: their ability to pay the bills, fill the gas tank and feed their families.
When facing credit card debt that can't readily be paid, the best plan of action is to act early, speak to creditors, reach some sort of payment arrangement and stick to a repayment plan. Otherwise, if debt goes unpaid and ignored, the courts may intervene by issuing a judgment requiring your employer to "garnish" or withhold a portion of your wages or property to pay back the debt.
A collection tool of last resort
"Garnishment is a legal remedy authorized by a court and should be considered a collection tool of last resort. In most states, the garnishment process can only be initiated by a court order and only if a judgment for monies owed has been entered," says David Cherner, legal and legislative director of state government affairs for The Association of Credit and Collection Professionals (ACA International).
"Clients are often embarrassed when faced with garnishment because now their paycheck is involved, which means their employer is aware of their financial situation," says Gail Cunningham, senior director of public relations at the National Foundation for Credit Counseling (NFCC). Employers are typically required to tell workers about the withheld amount -- if the employee isn't already aware of the situation. And while it is against the law for an employer to fire an employee whose wages are garnished, that protection goes away after a second and third such judgment, according to the Consumer Credit Protection Act.
The road to wage garnishment can be long and winding. Here's a look at the many steps in a typical scenario leading up to wage garnishment.
• The purchase: A purchase is made with a credit card and the customer is billed via monthly statement.
• The delinquency: The customer does not make the monthly payment and begins receiving late notices and past due statements.
• The charge-off: After 90-120 days -- depending on the creditor and the state -- the customer's bill is charged off and sold to a third-party debt collector.
• The debt re-sale: The credit card company sells the debt for less than the original amount owed, assuming a loss for the difference, and the collector pursues payment from the debtor.
At this point, if the resold debt can't be resolved, the collector has two main options:
• Option A: The re-re-selling of the debt: Collector may then sell the debt to another third party debt collector and so on.
• Option B: The lawsuit: In some cases, the creditor may pursue legal action to receive financial restitution on a debt.
Once legal action is taken, the debtor is at risk of possible wage garnishment.
• The ruling: The debtor loses the case and the court issues a judgment against the debtor's income or funds.
• The notification: The customer is advised of the judgment; the customer's employer is notified to garnish the employee's accounts.
• The garnishment: Money is garnished from payroll accounts or bank deposits and disbursed to the creditor until the debt is satisfied.
Creditors are required, per state laws, to provide lead time to debtors of any pending legal action, and generally prefer to avoid the hassle of filing a lawsuit. But once the judgment has been rendered, "the consumer's options are very limited," says Cunningham.
Credit card debt judgments and garnished wages
Once a credit card account (or similar debt) goes into default and the credit card company cannot collect, the company may choose to sell the debt to a debt collection company. If the credit card company or debt collection company is unsuccessful in recovering the debt, then a lawsuit may be filed against the consumer in an attempt to recover its losses. If the lawsuit is settled against the consumer, a judgment may be issued to garnish property or wages.
"When faced with notices threatening legal action, consumers should contact an attorney immediately to, at least, discuss options before the situation escalates and the consumer is faced with lawsuits and garnishment," says Joseph Rosenthal, a lawyer with Rosenthal and Mintz, a general practice law firm in Hauppauge, N.Y. "Once the situation reaches this point, if it is a legitimate debt, the consumer's only recourse is to either make a deal with the credit card company or to declare bankruptcy. Otherwise, a judgment may result, followed by collection procedures," he says.
The only recourse for a consumer after a judgment has been rendered is to ask the court to adjust the amount of the garnishment if the reduction in pay severely impacts the consumer's ability to support himself and any dependents. Also, if a judgment is ruled upon in a state where the garnishment law is