Kentucky Revised Statute 425.501 (Proceedings for obtaining order of garnishment.) Section (1) provides:

“Any person in whose favor a final judgment in personam has been entered in any court of record of this state may . . . obtain an order of garnishment . . . . “

What this means is that a creditor must first take you to court (sue you) and win a court judgment BEFORE seeking garnishment. Generally, this cannot happen without your knowledge and an opportunity to present your side of the story.

If the creditor is seeking arbitration of the debt, that means the creditor does not have the required court judgment, and cannot at this time seek any garnishment at all.

Arbitration is a a faster and cheaper way for this creditor to get a judgment against you.

So, you might not want to go along with it.

Stay on top of the situation. Read all the letters they send you, especially certified letters. There is little advantage to talking to the debt collectors on the phone. I think it is better to have all communications with your creditor to be in writing.

Also remember that everything is negotiable. Just because they say you owe $3800 does not mean that is the right amount. It needs to be questioned and verified as accurate and legal. Also, the creditor is very likely to agree to accept less. For example, if you could scrape together $1900 (50%) – or maybe less – in cash right now, the creditor might settle for that – BUT ONLY WITH THE PROPER WRITTEN DOCUMENTATION.

Sadly, debt collectors have been known to lie through their teeth sometimes – thus written communications and not phone discussions.

I tried to find information on the KRS website.
Any information is helpful.

Thanks!

Nikki

Take a look at KRS 427.010 “Exempt personal property and disposable earnings of individual debtors.” Specifically, subsection 2,

“Except as provided in subsection (3) of this section and KRS 427.050, the maximum part of the aggregate disposable earnings of an individual for any workweek which is subjected to garnishment may not exceed the lesser of either:
(a) Twenty-five percent (25%) of his disposable earnings for that week, or . . . . ”

It would seem that the maximum amount that can be garnished in total, however many creditors or separate debts, is 25% of your after-tax take-home pay.

Hope that helps.

Tom

There is a seeming unresolved conflict between 27 ORC §2716.02(A), 27 ORC §2716.03(A), and 1 ORC §124.10.

27 ORC §2716.02(A) sets a 15 day limit for a judgment-debtor employee to respond to the Debt Notice & Demand set forth in that section before a garnishment proceeding may commence under §2716.03. That Debt Notice & Demand is not normally served upon the judgment-debtor’s employer.

1 ORC §124.10 states that a garnishment proceeding cannot be commenced until 30 days after service of notice upon Ohio’s Director of Administrative Services.

It would seem that the initial Debt Notice & Demand of §2716.02 is also simultaneously served upon the Director of Administrative Services, or there is an additional step inserted after service of the notice upon the judgment-debtor and before the commencement of a garnishment proceeding.

“Garnishment proceedings are purely statutory and in derogation of the common law. General Truck Sales Inc. v. Simmons, 208 Tenn. 51, 343 S.W.2d 884 (1961). Our statutes creating the proceeding and giving it direction are found in T.C.A. §§ 26-2-201 et seq. The statutes provide that all property, debts, and effects of the defendant in the possession of the garnishee or under his control are liable to satisfy the plaintiff’s judgment. T.C.A. § 26-2-201. Property, debts and effects include real estate, chooses in action, money, and stock in an incorporated company. T.C.A. § 26-2-201. Under T.C.A. § 26-2-204 the garnishee may be required to answer under oath the following questions:

“(1) Whether he is, or was at the time of the garnishment, indebted to the defendant; if so, how and to what amount?

“(2) Whether he had in his possession, or under his control any property, debts, or effects belonging to the defendant, at the time of serving the notice, or has at the time of answering, or has had at any time between the date of service and the time of answering; if so the kind and amount.

“(3) Whether there are, to his knowledge and belief, any and what property, debts, and effects in the possession or under control of any other, and what, person?

“The garnishee has a duty to answer the questions truthfully and completely. Wyler, Ackerland & Co. v. Blevins, 113 Tenn. 528, 82 S.W. 829 (1904). When the garnishee is a corporation the duty includes an obligation on the part of the person answering the garnishment to investigate the corporation’s affairs respecting the judgment debtor and his property. See 38 C.J.S. Garnishment § 211. In other words, the corporation cannot turn the notice of garnishment over to an uninformed clerk and then rely on the clerk’s lack of knowledge as a defense to the charge that the answers are not complete or truthful.”