I was garnished two days ago. If I file bankruptcy today, can I get that money back?


The moment you file bankruptcy, the court issues a stay (stop) against most creditor actions.  From this moment forward, creditors cannot continue to garnish you.  The problem is:  that garnishment occurred prior to filing the bk.  The bankruptcy does not go back in time to stop that garnishment and force the creditor to return the monies to you.

Although you cannot get the garnished wages back, it it is was a large enough garnishment, the bankruptcy trustee may decide to sue the creditor for a preferential transfer action (arguing that the garnishment allowed that one creditor to be preferred over all other creditors in receiving a payment right before bankruptcy).  Unfortunately, even if the trustee gets the garnished money back, he won’t give any to you.  He’ll pay himself a healthy finder’s fee and then use the rest to pay your creditors.

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