Can Creditors Garnish My Wages?

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Dear Experian,

Can a creditor still garnish your wages even though the account is showing "closed" on my credit report? The account shows as, "Charged off as bad debt. Profit and loss write-off."


Dear SMC,

When an account is seriously past due, the creditor may obtain a court order allowing them to garnish your wages to collect the amount they are owed. In addition to federal law, there are also state laws that regulate wage garnishment. These laws may vary from state to state. Check with your state Attorney General's office for details about the laws where you live.

A Charge Off Does Not Mean the Debt is No Longer Owed

The term "charged off," simply means the debt was so past due that the creditor no longer felt it was likely that they would receive further payment and chose to write the account off as a loss for tax purposes.

This does not mean that you no longer owe the debt. The creditor can still attempt to collect the debt. One way they may be able do so is through wage garnishment.

Wages May Also Be Garnished by Collection Agency

In some cases, the creditor may choose to sell the debt to a collection agency instead. If the collection company also reports to Experian, you will likely see both the original creditor account and the collection agency account appearing on your credit report.

Once an account is sold to a collection company, the original creditor can no longer attempt to collect the debt. Instead, the collection agency will take over any collection efforts. As with the original creditor, the collection agency may seek wage garnishment if the debt is not paid.

Thanks for asking,
The Ask Experian Team