Yes, you may stop an administrative wage garnishment once it starts. If you did not have a hearing, have new evidence or changed finances it may stop.
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The Treasury will send you a notice of its intent to order an administrative wage garnishment. Thereafter, you can request a hearing. The hearing is usually a "paper hearing". This means you do not appear personally. Instead, you submit a legal brief and supporting evidence. However, if you fail to request a hearing timely, the Treasury will issue an administrative wage garnishment order to your employer. Similarly, if the hearing is held and the hearing officer finds in favor of the government, your wages will be garnished.
Once the administrative wage garnishment starts, you may stop it in limited circumstances. As stated, if you fail to submit your hearing request, the administrative wage garnishment order will issue. However, you can still submit a hearing request late. Thereafter, if a hearing officer does not make a decision within 60 days, the administrative wage garnishment will be suspended. The suspension will go into effect on the 61st day after your hearing request.
If you did request a hearing and the hearing officer ruled against you, you may obtain a new hearing if you obtain new evidence. However, the government will not provide you with a new hearing simply because you disagree with the hearing officer's initial decision. Instead, you must have obtained new evidence that would exonerate you from the administrative wage garnishment.
If your wages are subject to garnishment but your financial circumstances change, you may qualify for a financial hardship exemption. For instance, at the time of the original hearing your spouse may have been employed. But in the interim, your spouse suffered a lay off and remains unemployed, cutting your household income in half. As such, you may request a new hearing based on the financial hardship the garnishment now causes as you can't meet your basic living expenses. Keep in mind, you will have to provide financial documentation to prove the garnishment constitutes a financial hardship.
Our attorneys have years of experience dealing with administrative wage garnishments. Contact us today for a free initial consultation - 833-428-0934
Millions of Dollars in SBA Debts Resolved via Offer in Compromise and Negotiated Repayment Agreements without our Clients filing for Bankruptcy or Facing Home Foreclosure
Millions of Dollars in Treasury Debts Defended Against via AWG Hearings, Treasury Offset Program Resolution, Cross-servicing Disputes, Private Collection Agency Representation, Compromise Offers and Negotiated Repayment Agreements
Our Attorneys are Authorized by the Agency Practice Act to Represent Federal Debtors Nationwide before the SBA, The SBA Office of Hearings and Appeals, the Treasury Department, and the Bureau of Fiscal Service.
Client’s small business obtained an SBA 7(a) loan for $150,000. He and his wife signed personal guarantees and pledged their home as collateral. The SBA loan went into default, the term or maturity date was accelerated and demand for payment of the entire amount claimed was made. The SBA lender’s note gave it the right to adjust the default interest rate from 7.25% to 18% per annum. The business filed for Chapter 11 bankruptcy but was dismissed after 3 years due to its inability to continue with payments under the plan. Clients wanted to file for Chapter 7 bankruptcy, which would have been a mistake as their home had significant equity to repay the SBA loan balance in full as the Trustee would likely seize and sell the home to repay the secured and unsecured creditors. However, the SBA lender opted to pursue the SBA 7(a) Guaranty and subsequently assigned the loan and the right to enforce collection to the SBA. Clients then received the SBA Official 60-Day Notice and hired the Firm to respond to it and negotiate on their behalf. Clients disputed the SBA’s alleged balance of $148,000, as several payments made to the SBA lender during the Chapter 11 reorganization were not accounted for. To challenge the SBA’s claimed debt balance, the Firm Attorneys initiated expedited discovery to obtain government records. SBA records disclosed the true amount owed was about $97,000. Moreover, because the Clients’ home had significant equity, they were not eligible for an Offer in Compromise or an immediate Release of Lien for Consideration, despite being incorrectly advised by non-attorney consulting companies that they were. Instead, our Firm Attorneys recommended a Workout of $97,000 spread over a lengthy term and a waiver of the applicable interest rate making the monthly payment affordable. After back and forth negotiations, SBA approved the Workout proposal, thereby saving the home from imminent foreclosure and reducing the Clients' liability by nearly $81,000 in incorrect principal balance, accrued interest, and statutory collection fees.
The client personally guaranteed an SBA 504 loan balance of $375,000. Debt had been cross-referred to the Treasury at the time we got involved with the case. We successfully had debt recalled to the SBA where we then presented an SBA OIC that was accepted for $58,000.
Clients personally guaranteed an SBA 504 loan balance of $337,000. The Third Party Lender had obtained a Judgment against the clients. We represented clients before the SBA and negotiated an SBA OIC that was accepted for $30,000.
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