Identification

• Garnishments do not appear on a credit report, according to Jeanine Skowronski of the Main Street website. As of 2011, the credit reporting bureaus have access to garnishment orders but choose not to report them. What can affect your score is a civil judgment leading to a garnishment. Court judgments affect your credit rating by as many as -- and possibly more than -- 100 points. It has the similar effect of any other delinquent account, such as a collection account, charge-off or tax lien, in how much it lowers your overall credit score.
  
  

Debt-to-Income Ratio

• Even though a garnishment order does not go on your credit report, you still have to report it on a loan application as a debt obligation. Lenders give almost as much weight to your credit rating as your ratio of monthly debt payments to monthly income. The ideal debt-to-income ratio varies by lender, but lenders usually won't lend to any application with a ratio higher than 35 percent to 50 percent, according to Erin Peterson of Bankrate.com. Omitting the wage garnishment could constitute credit fraud.
  
  

Considerations

• You probably have several missed payments on your record and possibly other delinquent debts if you let a debt go into default so long that the creditor files a lawsuit. The garnishment can take up to 25 percent of your paycheck, which may mean you do not have enough money to pay your other debt obligations and cover other life necessities.
  
  

Tip

• You can exclude some income from garnishment, such as Social Security, and your state may offer additional garnishment protection. However, you should try to settle the debt with the creditor. Creditors often negotiate on debts because filing garnishment orders can cost hundreds or thousands of dollars in legal fees. At the very least, you can offer to pay the debt in installments to avoid a civil judgment on your record.