Is It Possible to Get a Loan While Being Garnished?

Save
Is It Possible to Get a Loan While Being Garnished?
Is It Possible to Get a Loan While Being Garnished? (Image: penywise/sxc.hu)

Loan approvals are based on your credit history. While a wage garnishment does not appear on your credit history, the lawsuit preceding your wage garnishment does. This can affect your ability to get approved for a loan.

The Facts

If you stop paying down a debt, your creditor may sue you and request a wage garnishment. A portion of each paycheck will be withheld to pay the debt.

Significance

Any lawsuit that results in garnishment leaves a judgment on your credit report. Judgments adversely affect your credit score and can cause you to be turned down for a loan.

Types

Garnishments for federally owed debts, such as taxes and student loans, do not require lawsuits. You may be garnished for these debts while maintaining decent credit, which increases your chances of a loan approval.

Time Frame

Even if you are still being garnished, you may get a loan approval if the judgment did not occur recently. As credit report entries age, they have less of an impact on your score.

Considerations

Not all judgments result in wage garnishments. Because of this, a lender has no way of knowing that you are being garnished unless you volunteer the information.

Related Searches

References

Promoted By Zergnet

Comments

You May Also Like

Related Searches

Check It Out

4 Credit Myths That Are Absolutely False

M
Is DIY in your DNA? Become part of our maker community.
Submit Your Work!