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Being Judgment Proof Is Not As Cool As It Sounds


The law makes it possible for creditors to force borrowers to pay debts, but the creditors must go through a long process to get to the point of judgments and wage garnishments.  Even if a creditor follows all the steps and has the law on their side, it is not possible to collect money that doesn’t exist.  Sometimes creditors follow you around for years, knowing full well that you cannot pay, and the situation is frustrating for everyone.  Saying “I’m judgment proof” can make creditors disappear temporarily, but it is not the failsafe cootie shot or cloak of invisibility that some people think it is.  If creditors keep bothering you even though you are judgment proof or think you might be judgment proof, contact a Philadelphia debt collection abuse lawyer.

What Are the Privileges of Being Judgment Proof?

A borrower is said to be judgment proof if he or she has so little in the way of income and assets that, even if the court issued a judgment in favor of the creditor, there would be nothing for the creditor to seize.  Some judgment proof debtors are elderly or unable to work because of disabilities, and others have minimum wage jobs that barely enable them to afford groceries, housing, and utilities.  In other words, judgment proof is just another way of saying dirt poor.

If you are judgment proof, however, it means that, even if a creditor sues you and gets a judgment, there is nothing the creditor can do to make you pay.  They can’t seize your assets, because you don’t have any; the creditor would not be able to collect the debt amount by seizing and selling your toothbrush and your bean bag chair.  They also can’t get a wage attachment, because garnishing your bank account would leave you without food or housing.

Which Income Is Exempt From Debt Collection Judgments?

Your income is judgment proof if it comes from any of the following sources:

  • Social Security or Supplemental Security Income
  • Veterans Administration
  • Federal Employee retirement income
  • Federal Railroad benefits, including retirement
  • Child support or alimony payments ordered by a family court
  • Benefit payments received on a Direct Express card

As long as the balance in your bank account does not exceed two months of income from these exempt sources, the court cannot garnish it.

What Happens If Your Fortunes Take a Turn for the Better?

If your financial situation improves, you may no longer be judgment proof.  The bad news is that creditors can continue renewing the judgment against you, even decades after a court first entered it.  The good news is that you have the right to file for bankruptcy protection to discharge as many of your debts as possible.

Contact Louis S. Schwartz About Protection Against Creditor Harassment

A Philadelphia consumer law attorney can help you if a creditor has sued you and obtained a judgment to collect the debt, but you do not have the money to pay.  Contact Louis S. Schwartz at CONSUMERLAWPA.com to set up a free, confidential consultation.



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