An unsecured creditor can garnish your wages but they have to follow the procedures that each state has written into law in order to do so. If you have a secured creditor, it is a way of saying that you have taken out a loan on a tangible asset that is being held as security for the debt. If you do not pay the debt then the lender can repossess the asset and sell the asset to satisfy the debt. An unsecured creditor is one that has loaned you money for something that they will not be able to repossess. An example would be your education that you financed with student loans. Another example is a credit card that you use to purchase consumable products that will cease to exist.
Before an unsecured creditor can garnish your wages, the lender must file court action. The lender must wait a specified amount of time in order to give you an opportunity to pay the debt before he can file to sue you for the balance of the loan. After the lender files the court action you will receive notice from the court that you must appear to answer to the petition. You will have to affirm to the court that you are the debtor and that you failed to make the required payments. If there is a mistake, then you will have to have documented proof of the error before the judge will consider there was an error.
When the judge has determined that you owe the debt to the creditor he will rule that you must pay the debt. This is termed a judgment. The creditor must have this in order to file for the paperwork to send to the employer to withhold your earnings. The term for this is a wage garnishment. An unsecured creditor can garnish your wages when he has followed the above process and the judge has ordered that you owe the amount the creditor seeks. If you have shown that there was fraudulent use of one of your credit cards then you may be able to seek relieve from the court for the debt.
A writ of execution is the court document that will allow the creditor to collect the judgment through earnings withholding. The lender will send the paperwork to your employer. The employer will take a specified amount of your wages each pay period to satisfy the withholding document. Each state has laws that govern the amount that can be withheld each time. Usually the upper limit is 25% of earnings. If you have income from social security, disability, or public assistance these funds are exempt from withholdings for nonpayment of debt. Can unsecured creditors garnish my wages? The answer is yes they can by following the process of the law to do so.