Legal Question in Credit and Debt Law in Tennessee
Debt collection and Social Security
My husband purchased aa auto and had to let it get repoed.The company he worked for shut down and then he was diagnosed with MS.He was eventually approved for SS.A collection agency has contacted us.We had agreed to a settlement but a new person has taken over the account and wants to change terms.I have nothing in writing about previous offer. My husband owns nothing. I had purchased a mobile home before we were married.I have no equity and the collection agency is threatening to have this debt added on to my mortgage.Can they do this?Can my husbands SS be garnished?I work at home for a very small amount of $.IF I get a job with more income my husband will lose Mcaid which pays for his med. which is $1200. per month.I have tried borrowing the $ but our bills are as nearly as much as SS and my income.Original Charge was 9000. but they offered 2500. and i was going to pay toward that but they want payment in full within 90 days which is impossible.Am Iresponsible for this debt I was not there when he made the Purchase and did not sign anything. I had my own car and this was his.
2 Answers from Attorneys
Re: Debt collection and Social Security
You have asked a lot of questions and I may not be able to answer all of them in this format. However, a first question that needs to be answered is whether or not you have any responsibility for the debt on the vehicle. With regards to the mortgage, unless you consent to it, the debt cannot be added to the mortgage. Generally social security earnings are going to be exempt from garnishment. If you have further questions, I would recommend that you contact an attorney in your area who handles consumer or Fair Debt Collection Practices claims.
Re: Debt collection and Social Security
I have advised clients on dozens of cases like yours, and your fact pattern presents the classic case for someone who should file for Chap. 13 bankruptcy. I will explain why after answering your questions.
The collection agency cannot add his debt to your mortgage. That is an outrageous claim for which the debt collector could be sued under the Fair Debt Collections Practices Act passed by Congress. However, the collector will likely claim that you misunderstood him.
Social Security Disability income is beyond the reach of debt collectors and cannot be garnished. Any state court that tried to garnish it would violate federal law.
If they have repossessed the car, then they have your husband's initial payments plus any down payment plus the car itself. They have been fully compensated most likely. You are being subjected to outrageous scare tactics, but you have no stick with which to clobber the debt collector YET.
Your husband needs to find a bankruptcy attorney who can file a Chapter 13 petition for him (1) at no cost to you or your husband ($0 dollars paid to the attorney) up front, and (2) within the next week.
I recommend you look on the Internet for a bankruptcy attorney: www.lawguru.com is a good site. Your local phone book yellow pages might have listings. Call around and see if you can find a bankruptcy attorney who will meet those two criteria.
Then you will have a big stick and federal law that will stop the debt collector from contacting you ever again. All claims for debts will have to go through the Bankruptcy trustee from that point forward.
With Chap. 13, you will not have to sell any of your assets or change your job / income source. Please be sure to tell the attorney that you know what you want, and you want to speak to him or her about Chap. 13.
If you have any trouble finding a local bankruptcy attorney, then you can write me and tell me what steps you took to find one. My e-mail is masg @ juno.com
Michael Guth, Ph.D., J.D.
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