Texas law allows student loan lenders and government agencies to issue wage garnishments against debtors who have defaulted on their debts.
Below are a few facts you should know about student loan wage garnishments:
- The law requires that a student loan lender send the debtor a written notice to their last known address at least 30 days before they issue a wage garnishment.
- The law requires that the debtor at risk of a wage garnishment be given the opportunity to have a hearing before an administrative judge and be given access to a copy of their of their student loan records for their review.
- The law requires that before a wage garnishment is issued, the debtor be given the opportunity to enter into a payment plan in lieu of the wage garnishment.
- If the wage garnishment is issued, the law states that the student loan lender cannot take more than 15 percent of the debtor's disposable income. Disposable income is generally considered the money that is left over after the debtor has paid any taxes or other deductions required by the law. In other words, after-tax income would be the disposable income subject to the wage garnishment.
- The debtor's employer is obligated by law to honor a wage garnishment order. If the employer fails to honor the wage garnishment order, they can be required to pay the wage garnishment themselves.
- An employer is prohibited by law from firing, punishing or refusing to hire an individual simply because they have a wage garnishment.
- If you are unemployed through no fault of your own, the student loan lender is prohibited from issuing a wage garnishment order until you have been employed on a continuous basis for more than 12 months.