Social Security Benefits And Debt Judgment

When you are trampled by the high interest rates of payday loans, you often think of taking out one more payday loan. Well, instead of doing so, you could lower your monthly payments using a payday loans consolidation program. The key point is to pay back your payday loan debt by any means. If you do not make your payments, your creditors will leave no stone unturned to get back the owed amount from you. However, some bank accounts or resource of earnings might be excused from the debt collection labors of a creditor. While talking about a debt judgment meant for medical debts or credit card balance, the social security benefits are generally protected. But based on your specific condition, the debt collector might directly take out funds from your depository account.

• Judgment proof – When you’re not employed or having assets of insignificant value, you might get a “judgment proof”. Even if you think that you meet the conditions for receiving judgment proof, it is always sensible on your part to act in response to your creditor’s lawsuit. If you fail to appear, there is a risk of a default judgment being granted to your debt collector. A “judgment proof” might only stop the collection activities for the time being. Once you get a job or your financial condition is stable, the creditor can try to get a court order for wage garnishment. Based on the type of your debt, the creditor might also garnish the social security benefits.
• Cease communication letter – You can send the debt collector a cease and desist letter if they continue their attempt of garnishing your bank account, even after knowing that your social security is your lone source of income. You could send the bank a cease contact letter requesting them not to freeze your bank account.  There is no guarantee that the bank will grant your request, but at least you could notify them that the money in your account is excused from debt judgments. Send a replica of the letter to every debt collector, via certified mail. Thereafter, they must stop contacting you, except to notify you of any consequent action that they would be taking.
• Fair Debt Collection Practices Act – There are many debt collectors who will go out of their way to conduct their illegal debt collection activities. This might include harassment and threatening calls, which are pure violations of the Fair Debt Collection Practices Act. You could contact the FTC-HELP at (877) or see the website (ftc.gov) to find out if your debt collector’s actions has violated the federal laws.

Donna Nell is a financial expert associated with a few financial communities. She also holds honorary posts in some websites as a financial advisor where she advises on debt management, credit counseling and taxes.