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<\/div>\n<\/p>\nIf you borrow money from a bank, you often have to provide collateral. The reason: the credit institution wants to reduce the risk that the loan will not be repaid. Therefore, many banks require that borrowers sign a wage garnishment, which is colloquially also called wage assignment.<\/p>\n
If the loan is not repaid due to payment difficulties, the bank can collect the loan through the salary and thus collect the outstanding receivables.<\/p>\n
But what exactly is hidden behind the two terms wage garnishment and wage assignment?? Where are the differences? What income is attachable and how high is the possible amount? What does non-garnishable income mean? The following guide deals with these questions.<\/p>\n
FAQ on wage garnishment and wage assignment<\/h2>\n
Wage garnishment what is it? <\/p>\n
Wage garnishment is a type of compulsory execution.<\/p>\n
Wage garnishment what to do? <\/p>\n
You can seek assistance from a debtor counseling service or consumer center.<\/p>\n
Wage garnishment for how long? <\/p>\n
If an enforceable maintenance order has been levied, the statute of limitations for maintenance claims increases from 3 to 30 years.<\/p>\n
Assignment of wages what is it? <\/p>\n
The bank often requires an assignment of wages as security. If the borrower does not repay his loan on time, the bank as creditor can demand the debtor's attachable wage claims from his employer.<\/p>\n
When is an assignment of wages ineffective?? <\/p>\n
Wage garnishment may be invalid if wage garnishment is generally excluded by the employer.<\/p>\n
Wage assignment and wage garnishment – what does it mean exactly??<\/h2>\n
The term wage garnishment is often associated with wage assignment. But these are two different procedures. Knowing the differences can prevent creditors from receiving too much money that the borrower does not get back.<\/p>\n
If the borrower fails to meet his or her payment obligations, creditors can take certain enforcement measures under certain circumstances. This includes the wage garnishment. As a result, a part of the debtor's salary goes to the creditors. The employer is considered a "third-party debtor.<\/p>\n
Wage garnishment proceeds as follows:<\/h3>\n
The creditor applies to the court for the debtor's wages to be garnished. <\/p>\n
The court subsequently issues a garnishment order, which is served on the debtor's employer.<\/p>\n
Upon receipt, the employer must submit a statement within the first 14 days listing the debtor's wage claims and attachable amounts.<\/p>\n
Accordingly, a non-garnishable income is also determined on the basis of the garnishment table. <\/p>\n
The employer then transfers the attachable part of the wage to the creditor, because he is obliged to do so by law.<\/p>\n
Wage garnishment and wage assignment – what is the difference??<\/h2>\n
In the case of wage garnishment, which the creditor applies directly to the employer, a certain minimum income must remain with the debtor. The exact amount depends on how many people need to be supported, because wage garnishment takes child support into account, for example.<\/p>\n
By means of a garnishment and transfer order, a part of the earned income is garnished, so that the employer pays to the employee only an income that cannot be garnished. For creditors, this is an effective measure to enforce the monetary claim against the debtor. A garnishment in which the debtor's entire earned income is garnished is inadmissible. He must be able to continue to support himself or his children.<\/p>\n
Wage assignment also transfers the attachable part of the debtor's income to the creditor in case the debtor is unable to repay the loan. It is a precautionary measure, so to speak, while wage garnishment is an enforcement measure. The creditor may garnish the attachable wages only with an enforcement order. The wage garnishment is served to the employer by a court.<\/p>\n
This is important<\/h3>\n
In the case of wage assignment, which is agreed between the creditor and the debtor and does not require a title, the debtor, unlike in the case of wage garnishment, voluntarily grants the creditor the right to collect the garnishable portion of the wage.<\/p>\n
In the case of a wage assignment, the creditor does not need to have the income garnished by court order. In the case of wage assignment, the creditor, unlike in the case of wage garnishment, turns directly to the employer.<\/p>\n
He can, but does not have to comply with the demands, because sometimes in the employment contract the assignment of wages was excluded. In this case, the creditor's only option is to go to court to obtain a garnishment of wages. Then, according to the law, the employer is obliged to transfer the attachable part of the income to the creditor.<\/p>\n
What does gross or net method mean?<\/h2>\n
The calculation is based on the gross or net method:<\/p>\n
In the gross method, the unattachable earnings and, on top of that, the taxes and social security contributions payable on the gross salary are deducted. The garnishable salary is reduced even further as a result. The higher the emoluments are, the lower the attachable income is.<\/p>\n
In the net method, the unattachable earnings are deducted and then only the taxes and social security contributions paid by the employee are taken into account in the calculation, which he must pay on the gross income and which remain without the unattachable earnings. The garnishable portion here corresponds to the amount that would have to be garnished even if the debtor had not received any unattachable income.<\/p>\n
What does unattachable income mean?<\/h2>\nThere are emoluments that cannot be garnished. These include:<\/h3>\n
Christmas bonus (maximum half of the monthly income) Capital-forming benefits, for example, building savings contract <\/p>\n
The garnishment exemption limit depends considerably on how many dependents there are. A legal obligation to support may exist not only with respect to children, but also with respect to spouses, registered partners, parents, grandparents, and grandchildren. This is taken into account when calculating the garnishment limit.<\/p>\n
Is it possible to terminate the employment due to wage garnishment?<\/h2>\n
Simply on the grounds that wages are garnished, the employer may not terminate employment or. Do not dismiss the employee. However, the situation is different during the probationary period, when the employee can be dismissed without cause or a fixed-term employment contract is not extended.<\/p>\n
Also, get a copy from the employer about any wage garnishment obtained. This allows you to see exactly whether the claim is justified and whether the amount is correct. If the claim is unjustified or too high, you should file a lawsuit with the district court.<\/p>\n
Summary<\/h2>\n
Almost every credit agreement contains a wage assignment. This entitles the creditor to collect the attachable portion from the salary if the borrower does not meet his payment obligations.<\/p>\n
Creditors who have this assignment of wages, therefore, do not need to have the wages garnished by court order. Wage garnishment, on the other hand, is not possible without a court order. In both variants there is a non-garnishable income. Both wage garnishment and wage assignment take place directly with the employer, who transfers the garnishable part of the income to the creditor.<\/p>\n
Income that cannot be garnished continues to be paid to the debtor. This ensures by law that the minimum subsistence level is still covered, so that the worker does not have to rely on support from the state and he or she can still meet support obligations.<\/p>\n
Wage garnishment can basically be terminated by paying off the debt, settlement or initiation of insolvency proceedings. Unless otherwise provided for in a contract, the assignment of wages shall always be served before a garnishment of wages if it was agreed upon before the garnishment of wages.<\/p>\n
This means that the amount of the income, which is above the unattachable sum, is first paid to the creditor who disclosed the wage assignment. Subsequently, the creditor who requested the wage garnishment is served.<\/p>\n","protected":false},"excerpt":{"rendered":"
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