LIFE EVENTS
QUESTIONS

Impact of Bankruptcy on Wages

Q.1. What is garnishment of wages?
A.

Wage garnishment is what happens when a creditor gets a court order for your employer to make payments out of your pay to the creditor. The court will also decide the amount of the garnishment.

Q.2. How can I stop the garnishment?
A.

You can stop the garnishment in three ways. You can pay off the debt. You could file a consumer proposal to the creditor. You can file for bankruptcy.

Q.3. What happens to my wages if I declare bankruptcy?
A.

Wages are not affected by bankruptcy. You will be required to fill out an Income and Expense Form listing your income. If your income is over a certain amount you will have to pay a portion of the surplus into the bankruptcy estate through the trustee. Surplus Income is clearly defined in Directive No. 11R2-2013.