Gave advise, now want to double check with the gurus on here

[woeisme]

I was at my sister-in-law's house the other night having dinner when all of a sudden my SIL puts me on the phone with a friend of hers that is having financial problems since she thinks I'm so "smart" about these things (hey, I'm in the middle of a BK here, how smart can I be???) Anyhow, this friend of my SIL is being sued by a creditor. They've been harassing her on the phone and now she got a summons by the court that they are sueing her, and she is totally distraught. This woman is in her mid-60's, living off of Social Security. Her husband's only source of income is SSI because he is disabled. They own nothing other than an old car (in husband's name) and have no $ in their bank accounts. The debt is only in her name, and was aquired before she married her husband. I told her not to worry about the lawsuit, in my opinion all that is going to happen is that they would get a judgement against her, but they had no way of collecting since all their income was exempt (I think they might even be on foodstamps and I know they get help on their heating bills from HEAP, so they are definitely low income and all their income is social security retirement benefits and SSI-disability.) I told her to keep cashing her SS checks and using money orders and not to put anything in the bank (she said they had 1 account with 66 cents in it) and there was nothing that the creditor could do to her, she was judgement proof. I guess I just wanted some confirmation from others who know something about the law to make sure I wasn't blowing sunshine up her skirt. Her big concern was that they might try to put a lein on her husband's car, but since it's not in her name (bought before they got married last year) and we're not in a community property state (Ohio) I also told her I didn't think that would be an issue. Does anybody see any angle I might be missing here? I guess the only reason I'm at all worried that I might have misled her about being judgement proof is that the creditor (was a credit card, now a collections agency with a lawyer's name on it are seeking the judgement) thinks it's worth the time and money to go to court, so is there something that they see that I'm missing? Of course I don't know her entire situation, just what I was able to get out of her in this weird impromptu phone conversation, maybe there was another questions I should have asked that I forgot? She lives in an apartment, poor with no assets and no wages or bank account, is there anything else they could go after? Thanks!

[jp2861]

If it was me in her situation I would show up in court and have my exemption paperwork filled out and ready to file, on the spot. They may get the judgement but I would let them know immediately that they are chasing exempt funds.

One thing to remember about exempt monies: They are only exempt if legally claimed to be such. She must file an exemption to protect this money.

As far as being judgement proof: Nobody is truly judgement proof. I'm not sure why that phrase was ever thought up. One can be execution proof, such as her situation. But, a judgement can be granted against anyone. There just wouldn't be any way for the person sueing to execute the judgement and collect.

[woeisme]

my understanding is that right now she just has a summons telling her that she is being sued, so no judgement against her. Wouldn't the judgement have to be granted, then the 30 days expires, then the creditor would have to try to do a garnishment? How could they get a garnishment order against her SS check when SS is exempt? Or against a bank account that only has 66 cents in it? I went on-line and downloaded an exemption claim form for her, but it says on it that it needs to be delivered to the person who files the writ of garnishment, and since they have not even got a judgement against her yet, let alone a garnishment order (which again, I don't see how they can get a garnishment order against someone who doesn't have any $ or property that can be garnished) then I don't know if she should be worrying about this form yet or not? I'll definitely pass on the suggestion to her though, she might want to stop them dead in their tracks at the judgement hearing, but I imagine she's already told them her financial situation and that hasn't stopped them from filing.... I'll have to ask her if she's told them her income is from SS and she doesn't have any money in the bank or any property. Thanks!

[HHM]

SS checks cannot be garnished directly. The SS admin. is not subject to writ of garnishment (except from the IRS).

It's not likely they would put a lien on the husbands car if it is only titled in his name and the debt is solely in her name. (note, whose name is listed as the defendant on the summons and complaint?)

Given her age, and situation, she is pretty much execution proof.

[no_it_all]

As far as being judgement proof: Nobody is truly judgement proof. I'm not sure why that phrase was ever thought up.

I agree fully, there is no such thing as being judgment proof..I have been claiming that for a long time on this forum...

Back to the OP questions: I would answer the summons and I bet it would go away. BTW, what <exactly> was the credit extended for? Was it something tangible that could be repo'd?

[no_it_all]

SS checks cannot be garnished directly. The SS admin. is not subject to writ of garnishment (except from the IRS).

Incorrect....who cares if it is directly or indirectly. Creditors can still take part of your social security income. Student loans, VA mortgages, SBA loans, disaster loans, Medicare over payments and child support are a few examples of creditors that can garnish SS checks. The VA alone has about 55,000 SS checks garnished every month for past due on mortgages.

[woeisme]

It was for a credit card. She had one of those where they "give" you a card for $500, you immediately owe them $275 or something outrageous for their fee, and can use the other $225 credit scams. She had been paying on it monthly for a few years via money orders, but they changed addresses or something and are now claiming they didn't get her money orders and she owes them almost $1000 even though she never charged more than $100 worth of stuff on it, I don't know exactly, she was all worked up over the sheriff's office bringing her the court summons and I was trying to find out what type of income and assets she had more than worrying about who it was she owed. I do remember her saying that it was a lawyer who works as a credit collector going after her, not the original credit card company. I didn't think they were able to get garnishment orders on SS checks though, since they are no way supported by the government the way student loans, the IRS, etc are.

[no_it_all]

Ok, sounds like a <bottom feeder> collection agency..they can be pretty tenacious, but don't worry. If she has been served, the time to answer has probably already passed and as others have posted, it really makes little difference. Grammy might receive a judgment, but the creditor isn't going to get anything. If she could have explained that in her answer to the summons, these scum bags might have slithered off.........good luck

[HHM]

Incorrect....who cares if it is directly or indirectly. Creditors can still take part of your social security income. Student loans, VA mortgages, SBA loans, disaster loans, Medicare over payments and child support are a few examples of creditors that can garnish SS checks. The VA alone has about 55,000 SS checks garnished every month for past due on mortgages.

Yeah, those are all government/special class creditors, the creditor at issue for the OP is a credit card.

[no_it_all]

Yeah, those are all government/special class creditors, the creditor at issue for the OP is a credit card.

Yes, I can read also... but nobody knew that until I asked...certainly it wasn't known by anyone reading the original post.

The following statement is clearly incorrect...

SS checks cannot be garnished directly. The SS admin. is not subject to writ of garnishment (except from the IRS).

In the future instead of making a blanket statement suggesting only the IRS can garnish social security it would be more accurate to A: find out the type of debt and the creditor and B: mention those special classes that CAN garnish social security...

[HHM]

I prefer not to bore members or burden them with information (long posts) that is beyond the scope of their question.

I had a pretty good impression from the OP that we were not talking about special class creditors. If you have been on this board as long as I have, you understand that most people will actually "mention" the special class if it is applicable. When most people on this forum use the word "creditor" they typically mean private creditors (typical consumer debt). Also, most (not all, but most) special class creditors don't need to "sue" to get a judgment, so based on that context, I felt comfortable assuming we were talking about a run of the mill credit card, or other private creditor (and, as you can see, I was right).

If you want to play "word games", my comments are NOT incorrect, the comments are merely "incomplete". But, it is only incomplete insofar as the additional information that could have been provided is not relevant to the OP's questions or concerns.

[GoingDown]

Incorrect....who cares if it is directly or indirectly. Creditors can still take part of your social security income. Student loans, VA mortgages, SBA loans, disaster loans, Medicare over payments and child support are a few examples of creditors that can garnish SS checks. The VA alone has about 55,000 SS checks garnished every month for past due on mortgages.

I have no idea where you get your information??? Post a link to this info.

As far as I know, Social Security and SSI are 100% exempt from garnishment unless the I.R.S. or student loan department comes after them. Arizona Revised Statutes even state that SS and SSI are exempt from judgment creditors, and I imagine her state has similar provisions. I have relatives who get SS and SSI and have judgments against them, and the judgment creditors have never been able to garnish their SS and SSI income.

The Original Poster's debts are consumer debts, so she is about as Judgment Proof as one can possibly be. They may get their judgment against her, but they'll probably never get a dime out of her. As long as she keeps cashing those checks and not depositing them into checking account. Just keep using money orders.

And since she doesn't live in a community property state, her husband's car is probably off limits to them, but they usually don't want an old used car anyways.

Creditors use lawsuits to scare most people into paying, and then if that doesn't work, they try to find wages to garnish (she doesn't have anything to garnish), checking accounts to seize, and real estate property to slap a lien on.

She probably doesn't have the money or the knowledge to fight the lawsuit in court, and even she did, she would probably lose anyways. Why spend money and time fighting it, when she's judgment proof anyways?

[no_it_all]

I have no idea where you get your information??? Post a link to this info.

I get it from the United States Social Security Office. Took about .25 seconds for Google........Here you go:

Section 207 of the Social Security Act (42 U.S.C. 407) protects Social Security benefits from assignment, levy, or garnishment. However, the law provides five exceptions:

Section 459 of the Act (42 U.S.C. 659) allows Social Security benefits to be garnished to enforce child support and/or alimony obligations;

Section 6334 (c) of the Internal Revenue Code (26 U.S.C. 6334 (c)) allows benefits to be levied to collect unpaid Federal taxes;

Section 3402 (P) of the Internal Revenue Code allows beneficiaries to elect to have a percentage of their benefits withheld and paid to the Internal Revenue Service to satisfy their Federal income tax liability for the current year;

The Debt Collection Act of 1996 (Public Law 104-134) allows benefits to be withheld and paid to another Federal agency to pay a non-tax debt the beneficiary owes to that agency: and

The Tax Payer Relief Act of 1997 (Public Law 105-34) authorizes the Internal Revenue Service to collect overdue federal tax debts of beneficiaries by levying up to 15 percent of each monthly payment until the debt is paid.

Now, unlike the <moderator> I don't <assume> anything in someone's post, I would rather ask a question, and make an informed reply rather than a <guess> ..but that is just me. Oh and not to beat a dead horse, but saying that ONLY the IRS can garnish SS is of course...incorrect.

[no_it_all]

If you want to play "word games", my comments are NOT incorrect, the comments are merely "incomplete".

Wow, do you ALWAYS have issues admitting you made an mistake? Saying that ONLY THE IRS CAN GARNISH SOCIAL SECURITY is of course..........incorrect. Please read your own post....geez!!

[HHM]

Wow, do you ALWAYS have issues admitting you made an mistake? Saying that ONLY THE IRS CAN GARNISH SOCIAL SECURITY is of course..........incorrect. Please read your own post....geez!!

Right back at you.