senior citizen what to do for credit card debt summons
Is my social security and pension exempt from debt collectors garnishing?
I was forcibly retired concluding twelvemonth and am paying 8 credit card bills -one in collection - with an income of ss and pension simply. I can't practise it anymore. What do i do?
Is my ss and pension exempt?
—elliot
It sounds like you are asking what will happen if you stopped paying on all, or maybe merely the account you already have in collections. The quick respond is that your social security income cannot be garnished at the source, and most pensions are exempt from garnishment too. You would start have to exist sued, and a judgment entered in court, before in that location is whatever gamble to your money from a debt collector. And what chance there is, given the sources of the income, would be when that money is on deposit in your bank business relationship, so in the course of a bank levy.
If your situation reaches a indicate where you have to be concerned about how a debt collector will go almost trying to collect on a judgment, you would then expect to how much of your stuff (money in bank account, wages, personal property, car) is protected by state police. The amount of protection you have from creditors in your state may surprise you.
What state do you alive in?
Bank Business relationship and Wages – Limiting Your Chance from Debt Collectors
Earlier yous react to how much gamble yous have if a creditor sues you lot in society to get paid, consider whether that can exist avoided. Your not able to pay all eight credit carte du jour debts today, so something has to give.
What if your credit card payment could be lowered, and stock-still at a more affordable monthly amount?
Add together up all of your credit carte bills and and then calculate what 2% of that balance is. Is that amount much lower than what yous are paying out to all eight cards today? If it is, you are paying higher involvement rates. If those rates are lowered (and fixed), would you lot be able to pay that amount consistently on your stock-still income? If yes, read through the credit counseling section of my debt relief guide.
If roughly 2% of your consolidated credit menu balances is out of the question, what well-nigh negotiating lower balance payoffs? Your credit bill of fare debts can be settle for less than what yous owe once they reach a certain level of delinquency. If you are not making monthly payments to your credit cards, and saving up all the money you tin can instead, how long would information technology have you lot to puddle together virtually half of your credit menu totals?
If your answer is less than 24 months, settling these credit card bills may be the answer to avert bankruptcy. Continue in heed that some creditors will accept settlement far lower than 50%. The review postal service about what major credit card lenders settle for is adequately accurate. Employ that as a beginning guide to how much money you lot will need to settle with your banks.
You can postal service a listing of your dissimilar creditors in the comment section below, with the balances as of today, and I can offering feedback about negotiation targets, timing, and prioritizing creditors who are the most likely to sue. Settling with the right creditors early can limit your risk of banking concern levy and property liens.
Put the Debt Behind You with Chapter 7 Bankruptcy
While bankruptcy is something almost people want to avoid at all costs, I usually find they accept not assessed the costs at all. While nosotros talk about your credit card bills being affordable with credit counseling, or by settling for less above, chapter vii bankruptcy is typically the ultimate in affordability.
Chapter 7 could price you less than 2k from start to finish (I have seen costs less the 1300). Yous are able to discharge those credit card debts (and other bills), and one time discharged, you remove any and all take a chance of being sued, or any type of bank levy, garnishment, and property liens.
Y'all have to qualify for affiliate 7 bankruptcy using an income means test specific to your state. And merely like in that location are country exemption laws that protect y'all from debt collectors, there are state exemptions for what you are allowed to continue in a chapter 7 bankruptcy. If your stuff is valued at more than the exemptions in your country, yous may look to a affiliate 13 bankruptcy where you repay some, or all of the debt, over probably 5 years. Merely when information technology comes to people having to consider chapter xiii, I have oftentimes found those folks to exist the best candidates for settling the debts for less instead.
What if you simply didn't pay, and did nothing?
Some folks with as well many bills, and non enough income and avails (like limited to social security), will finish making payments all together, and look for whatever comes. If sued, and a court judgment entered, they already know they are not at risk because; their car and other personal belongings are protected by state police force; they are not working in gild to be garnished; wages are low plenty in their country to be protected; live in a state where wage garnishment is not allowed; and funds similar social security that are exempt are the only moneys deposited into their bank account.
Some people may feel that doing nothing is better than filing for bankruptcy, and there are many times I volition agree. Check out this interview I did with Eric Olsen, Executive director for HELPS. Eric and his squad are bachelor to assist seniors, those receiving disability and VA benefits, in order to protect themselves from all mode of debt collection:
This was a pretty long winded answer to a brusk question. My goal with this page is to bring the land exemptions from actress ordinary debt drove into focus. Anyone with questions or concerns about this topic can post in the annotate section below. Please include the land yous live in.
Need some personalized help?
If you lot would similar confidential help you lot can…
- ask a quick question here
- request a general debt consultation here
- get a settlement estimate hither
- use the CRN Platform to settle your debts or find defended Debt Autobus here
Non sure where to kickoff? Click on the big blue "Go Debt Help" button.
Michael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked equally an expert witness in court matters related to the debt relief industry, and is a regular contributor to several personal finance websites.
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