How a Consumer Proposal or Bankruptcy Can Help Stop Wage Garnishments

When debt becomes overwhelming, one of the most stressful consequences is wage garnishment. Having a portion of your paycheque deducted before it even reaches your bank account can make it nearly impossible to cover everyday expenses, such as rent, groceries, or transportation.

If you are facing wage garnishment in Canada, it’s essential to understand that you have options and legal protections that can help you regain control of your income. Two of the most effective solutions are filing a Consumer Proposal or Bankruptcy through a Licensed Insolvency Trustee.

What Is Wage Garnishment?

A wage garnishment is a legal order that allows a creditor to collect a debt directly from your employer. This means a percentage of your pay is deducted and sent to your creditor until the debt is fully paid.

This process can be devastating for individuals already struggling with debt, as it reduces their take-home pay and adds stress to their financial situation.

How a Consumer Proposal Can Help

A Consumer Proposal is a legally binding agreement between you and your creditors, administered by a Licensed Insolvency Trustee. Once the proposal is filed:

Wage garnishments must stop immediately.

Creditors can no longer take legal action against you or contact you directly.

You consolidate your debts into one affordable monthly payment, often reducing the total amount you owe.

This option enables you to retain your assets, safeguard your income, and establish a clear path toward achieving debt freedom.

How Bankruptcy Can Help

If your debt is too high to manage through a Consumer Proposal, filing for Bankruptcy may be the right solution. Like a proposal, Bankruptcy provides:

·  Immediate protection from wage garnishment.

·  A legal “stay of proceedings” that stops all collection activity.

·  A structured process to discharge your debts and rebuild your financial life.

·  While Bankruptcy can feel overwhelming, it is often the most direct way to get relief from creditors and start fresh.

Taking Back Control

Facing wage garnishment is frightening, but you are not alone, and you don’t have to live with it. Both Consumer Proposals and Bankruptcy are designed to give you a chance to reset your finances, protect your income, and move forward with peace of mind.

At MORATAYA Corp, our Licensed Insolvency Trustees can review your situation, explain your options, and help you choose the path that best protects you and your family.

Call us today at (416) 784-0904  to book your free consultation.

📞 Ontario: (416) 784-0904

📞 Alberta: 1 (888) 880-0904