Can a Personal Injury Settlement Be Garnished?

There can be instances in which a personal injury settlement is garnished. In these instances, a creditor can deduct money directly from a plaintiff’s personal injury settlement. Then, the plaintiff receives the remaining settlement amount. 

At High Rise Financial, we help personal injury victims pursue damages in court. We offer lawsuit loans for construction accidents and other personal injury cases. Our team also provides insights into personal injury settlement garnishment. 

What Is Garnishment?

Garnishment refers to a legal process for collecting payment for a debt. If a plaintiff’s personal injury settlement is garnished, a certain amount is deducted and given to creditors. This amount is determined based on the plaintiff’s debt, and it can be based on several factors.

For example, a plaintiff with past-due child support can have their personal injury settlement garnished. In this scenario, the plaintiff settles their case and is awarded damages. The plaintiff’s damages are then reduced to account for their back child support. 

The laws for garnishment vary across the United States. If a plaintiff has outstanding debt, it is important to share this information with their personal injury attorney. Next, the attorney can work with the plaintiff to structure their settlement request in a way that guards against garnishment. 

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Is Garnishment Required for Personal Injury Settlements?

Garnishment is not mandatory in every state. A personal injury attorney can provide details about the garnishment laws in the state where a plaintiff has filed their case. The lawyer can explain if a garnishment is possible and if so, offer tips and insights on how to avoid this issue. 

Creditors cannot demand money from a plaintiff’s personal injury settlement if an individual’s balances are paid in full. As such, a plaintiff should try to do everything possible to prevent debt from accumulating. This enables a plaintiff to receive the full amount of their personal injury settlement without the risk of garnishment. 

Also, a plaintiff can work in lockstep with their personal injury attorney. If a plaintiff is upfront and honest with their lawyer about any debt, the lawyer can prepare accordingly. The attorney and plaintiff can explore ways to maximize the request for damages and minimize the risk of garnishment. 

Is It Possible to Dispute a Garnishment Request on a Personal Injury Settlement?

A plaintiff can contest garnishment on a personal injury settlement. The plaintiff must present compelling evidence to dispute the garnishment. If successful, the plaintiff may be able to complete the full amount of their personal injury settlement. 

When a court receives a dispute to a garnishment on a personal injury settlement, it reviews the objection carefully. It considers the best interest of the plaintiff and creditor. The court may require months before it renders its decision. 

If a dispute to garnishment is unsuccessful, a plaintiff is required to have their personal injury settlement garnished. Once the garnishment is complete, the plaintiff receives the remaining amount of their settlement. If the garnishment does not cover the full amount of their outstanding debt, this individual is still responsible for paying it. 

Are There Any Exceptions to Garnishment of a Personal Injury Settlement? 

A court may require a plaintiff to use their personal injury settlement toward medical costs. For example, a plaintiff can experience a spinal cord injury and be awarded damages. The costs to treat the injury can be substantial. 

In the aforementioned example, the plaintiff may have no other option than to use their settlement to cover the costs of their spinal cord injury treatments. Even though a creditor wants the plaintiff to pay their debt, it is most important for this individual to get their medical treatments. The only way for the plaintiff to afford these treatments may be with their personal injury settlement. 

Garnishment can be complex, but a personal injury attorney can explain it to a plaintiff. The lawyer will offer insights into garnishment and its potential impact on a settlement. In addition, the attorney will offer solutions to help their client prevent garnishment. 

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How Can I Prevent Creditors from Garnishing My Personal Injury Settlement?

It can be helpful to get a certified copy of a judgment that states a plaintiff received a personal injury settlement. This copy validates the fact that a plaintiff secured money due to a personal injury case. If necessary, the plaintiff can use the certified copy of a judgment as evidence to dispute a garnishment. 

Setting up a separate bank account for personal injury settlement funds can be beneficial. This gives a plaintiff one account for all of their funds. If garnishment is requested, the plaintiff can have any funds deducted directly from this account. 

Partner with a personal injury attorney who understands the challenges and dangers associated with garnishment. This lawyer can provide personalized tips to help a plaintiff secure the maximum amount of damages in a personal injury case. Plus, the attorney can make it easy for the plaintiff to pursue all available loan options while their personal injury case moves forward. 

Will Getting a Lawsuit Loan Cause My Personal Injury Settlement to Get Garnished?

A lawsuit loan serves as a financing option for those in the middle of a personal injury case. The loan has no effect on garnishment if a plaintiff receives a personal injury case settlement. In this instance, the plaintiff’s loan is repaid to the pre-settlement funding company. 

To repay a lawsuit loan, a plaintiff’s lawyer offers plenty of support. The attorney deducts the amount of a lawsuit loan from a plaintiff’s settlement. Finally, the plaintiff receives the remaining settlement amount. 

If a plaintiff’s personal injury case is unsuccessful, this individual is not held responsible for repaying their lawsuit loan. The plaintiff’s attorney notifies the pre-settlement funding company about the case result. This company clears the loan balance, and the plaintiff keeps the full amount of their pre-settlement funding. 

How Can I Get a Lawsuit Loan in a Personal Injury Case?

High Rise Financial offers risk-free lawsuit loans. Tell us about your personal injury case, and we can provide details about our lawsuit loan options. To learn more, please get in touch with us today.

Call or text (877) 735-0016 or fill out our form to apply today for free.