In the state of North Carolina, there are certain debts which can result in your paycheck being garnished. According to North Carolina law, your employer may be ordered through the court system to garnish/withhold/deduct wages from your paycheck and pay your wages to a Creditor for the following types of debts: taxes, student loans, child support, alimony, and payment of ambulance services in certain North Carolina counties. Debts such as taxes, student loans, child support and alimony are usually non-dischargeable when filing bankruptcy in North Carolina.
However, the courts of North Carolina are not permitted to order an employer to withhold wages for other types of debts such as car loans, credit card debt, and other personal debts.
Often an alternative to a Creditor being allowed to garnish an individual’s wages, a creditor may sue you and obtain a lien which may be placed on your home, automobile or personal property. A judgment lienis a way of collecting on your unpaid balance to a Creditor. Until you, the owner of the asset, take some action to sell, transfer, or refinance the home, car or personal property; the lien will remain attached to the item. Once you sell, transfer, or refinance the item, all judgment lien holders may be entitled to collect on their judgments, depending on the nature of the situation.
The easiest way to get a judgment lien released is to pay the judgment in full. The law requires that the Creditor release the judgment from the debtor’s asset when the agreed balance is paid in full. In most cases, the Creditor signs a verified statement that the judgment has been paid in full and should be released. The other option would be to include the unpaid Creditor into your bankruptcy filing and discharge the qualified debt. In the case where a judgment and/or lien has been issued through the court, your attorney will notify the Creditor, the attorney representing the Creditor and the court in which the judgment has been filed. Additional motions, such as a Motion to Avoid a Judicial Lien, may have to be filed with the court in order to remove the lien(s) from your asset depending upon your specific case.