I have helped out a lot of senior citizens during my time as a bankruptcy attorney in Oakland. More often than not, I don’t file a bankruptcy case for them for the simple reason that they often don’t need one. Instead I help them understand that they often can simply do nothing–and that includes stopping any further payment of creditor card bills. In the United States and in California in particular, we want to protect our seniors a bit more than the younger generations. To do that, the federal and state governments have set up some very strong protections for the elderly.
Your Social Security Checks Are Protected from Your Creditors
The first is this: Social security is protected from pretty much all creditors. (The only rare exception may be the US government and in that case, there still may be options to avoid having your social security check intercepted.) This is important. No creditor, no one you owe money to, no one who is trying to collect on a bill you owe can touch your social security! It is protected. This is true for monthly social security payments you have in your bank account (up to a certain limit) and for your right to future payments of social security.
I make a big point of this because I’ve had lots of scared and beaten down seniors come to my Oakland bankruptcy office frightened out of their wits because a bill collector has been telling them that their kind of debt can’t be wiped out in a bankruptcy, or their kind of debt is fraud so it’s kept out of bankruptcy. Rubbish like that. The problem of course is that my elderly clients aren’t familiar with the law and are often susceptible to the lies of bill collectors.
By the way, California and federal law require bill collectors to be truthful in their communications with the people they are trying to collect from. Violations of federal and state fair debt collection practices laws can subject creditors to fines and punishment. Pensions and other private retirements are also protected from creditors. Keep in mind, however, that these exemptions amounts are not unlimited, so you should probably talk to a knowledgeable Oakland bankruptcy attorney before you make decision about how to deal with creditors.
If Social Security Is Protected, Bankruptcy May Not Be Necessary
So, here’s my important point: Seniors in the Oakland area who are having serious debt problems may not need to file for bankruptcy. Since creditors can’t take their pension or social security, they really can’t do anything to a senior who does not own any real estate. This folks are referred to as being “judgment proof.” In other words, even if a creditor sued and got a judgment against them, the creditor still couldn’t get anything from them. That’s very good news for the elderly and should allow them to sleep better at night.
Beware of Lying Bill Collectors | Just Because They Say It Doesn’t Mean It’s True
Unfortunately, unscrupulous debt collectors might continue to call and harass seniors even knowing that they can’t get anything. Their hope is to create such nuisance that the senior will make some sort of payments just so the collector will quit calling for another month. Again, this probably violates federal and state laws with regard to debt collection. But it also can cause a lot of stress for the senior.
In many cases, the elderly individual may elect to file a bankruptcy case in Oakland just to get the harassing bill collectors to stop calling. I have filed this type of case for many clients. We talk about all the issues I discuss above and I reassure them that if they do nothing, no one can take their retirement or social security. Nevertheless, for their peace of mind they elect to file a simple chapter 7 bankruptcy case and wipe out the debt once and for all. No more debt, no more phone calls.
Order a Free Book on Debt and the Elderly
I have written a book entitled Debt and the Elderly: A Guide for SF Bay Areas Seniors, Their Family Members and Caregivers. It’s available for free to Oakland-area residents who might be considering bankruptc. Just fill out the form below and I’ll send it right out to you. It will answer a lot of questions that seniors or those who care about them or for them are asking these days about debts and bill collectors.
