What Kind of Fees Are Charged When There Are Wage Garnishments?
Wage garnishment is a court order that directs an employer to withhold a certain amount of an employee's paycheck to satisfy a judgment. An employer can charge an employee garnishment processing fees to offset the administrative expenses. In many cases the court orders the debtor to reimburse the creditor for legal fees associated with the lawsuit and the garnishment process.
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Attorney Fees
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In many cases, the court orders the judgment debtor to reimburse the creditor for attorney's fees. The fees include the charges for the lawyer's work, plus the document fees and any court fees associated with filing the case against the debtor. This amount may vary, depending on how much the lawyer charges for his work. Court fees may also be different by state. Additional fees are charged when a judgment creditor obtains a writ of garnishment. If a judgment creditor does not collect the full amount in a single garnishment, he has a right to apply for another writ of garnishment. In this case, additional fees will apply.
Employment Investigation Fees
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Although debtors must provide employment information on credit applications, this information may be out-of-date when a creditor files the lawsuit. A judgment creditor may need to find a debtor's new employment information before he can file for the writ of garnishment. An attorney may charge a flat fee to find this information and additional fees to prepare forms for the writ of garnishment filing. The local sheriff also charges a fee to open a garnishment file and to serve the garnishment order to the debtor's employer.
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Administrative Wage Garnishment Fee
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Most states have laws that dictate how much of a garnishment fee an employer can assess from a debtor's paycheck. The fee is to reimburse the employer for administrative costs of complying with garnishment orders. An employer charges this fee from the employee's paycheck in addition to the garnishment withholding. Some states have a set fee per withholding and may have a limit on how much an employer can charge per month. Other states allow a set fee or percentage of the remitted amount, whichever is higher. Some states, such as Indiana, split the administrative cost between the judgment creditor and the debtor.
Rush and Delivery Fees
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A delivery fee is charged when documents need to be delivered to the court clerk or to the debtor's employer. In some situations, expediting delivery or other services may cost additional fees. An attorney may charge a rush fee for locating the debtor's employer if a creditor needs it the same or the following business day. The court can order the judgment debtor to reimburse the creditor for these fees.
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