Legal Remedies for Creditors

Legal Remedies for Creditors

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Legal Remedies for Creditors

The creation of a lien against a particular property of the debtor's can be a potent safeguard against delinquent payments and defaulting on a loan or extension of credit. Some processes guaranteed by statute may be used either as a preemptive remedy or reactive judgment in favor of creditor rights. One such example is the legal provision of attachment.

 

Attachment is a strategy that basically amounts to lawful seizure of a debtor's property to satisfy a debt. As a preventive measure, attachment keeps debtors from getting rid of assets to avoid collection or transferring them to an international account whereby creditors will have little to no access to them.

 

As noted, wage garnishment may also stand as a symbol of the importance of creditor's rights within debtor-creditor law. In fairness, those who have debts to satisfy to a lender or to an estranged former spouse or child may own up to their responsibilities and submit to a voluntary garnishment of their take-home pay. Nonetheless, it is often a court order granted to the party who extended the credit that will make any attempt to subtract from a person's income enforceable. Again, though, as national standards dictate, there are limits to this insurance of creditor rights. Unless the employee owes back taxes or domestic support, only 25% of each paycheck may be taken out pursuant to these interests.

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