Having HUD garnish your wages (or threaten to) in order to pay your debt is a serious matter. Here's what it means and how we can help you.
Debt is a serious issue. Expenses can quickly pile up, and without regular payment, your debt can become more problematic.
Just ask the HUD.
If you have received notice that you owe debt, the best thing do is act as soon as possible. When debt adds up, it can give room for an agency working on behalf of HUD to garnish your wages.
Wage garnishing is the act debt collectors take to access funds directly from your paycheck. If you are in deficit with the HUD, you might be at risk.
Understand the Process Agencies Take to Garnish Wages
First things first, you as a borrower have some form of debt.
In the occurrence of your debt going unpaid for an extended period of time, your status may become delinquent. Note that delinquency status on debts varies depending on the borrower/lender agreement.
The average cut off for unpaid debts to become delinquent is about 180 days. You will likely receive demand notices upon your first late or missed payment.
Failure to respond can lead to a notice of intent from the HUD stating the initiation of Administrative Wage Garnishment on your debt. This does not require a judgment or court order, but you as the borrower are entitled to notice and the opportunity for a hearing.
Notice of intent typically comes from a third-party private collection agency.
These are the people responsible for notifying your lender and your employer of delinquency status. They work on behalf of the HUD and can give orders to your employer on withholding wages.
The HUD has access to up to 15% of your disposable income per paycheck, as stated in the Debt Collection Improvement Act of 1996.
Know Your Options and Rights
You have rights as stated above to notice and hearing. You have additional rights to be aware of and exercise as well, depending on the state you live in.
Such rights include access to Social Security and veteran's benefits.
These are exempt from garnishment as income, meaning an agency cannot dip in to these forms of federal funding. However, once these funds are in your bank they may be accessed by collectors.
In the former, it is federal aid. In the latter, it is another chunk of your change.
Another good thing to know is you keep your job. Although collectors give holding instructions to your place of work, your employer cannot fire you for having one notice of intent from the HUD. However, in the event of more than one case, this protection is lost.
If you choose to request a hearing, make note of the postmark date on the notice of intent. Your request must be within 15 days after the postmark.
This is your opportunity to appear in court and challenge the claims made to garnish your wages. Challenges can be on the grounds that garnishing will cause undue harm, or can be filed if you believe you received a notice of intent in error.
Most importantly, contact someone right away. Sometimes it can be as simple as contacting your creditor to work out a payment plan.
Otherwise, contact a HUD attorney. Legal counsel is the best resource to understand your rights and choose next steps.
Free case evaluations are available through Protect Law Group today.