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Bankruptcy in Brief

             a service of the Moran Law Group

Social Security is safe from collectors

Federal law makes your Social Security benefits exempt from levy, garnishment, assignment by regular creditors, and from the trustee in bankruptcy. (The federal government can withhold some part of Social Security payments for taxes, student loans, or support, however.)

That means that even a creditor with a judgment cannot intercept your Social Security payments nor can they take the money from you after it has been paid to you.

Other exemptions

In addition to the federal exemption for Social Security benefits, each state has law protecting certain assets from the individual's creditors.  California protection for Social Security direct deposit. These exemptions are available without filing bankruptcy.

Most retirement plans, pensions, and 401(k) plans are also exempt from collection.

Resisting over-aggressive collection agencies

If you fall behind on your bills, collectors will use stress, fear and shame to get you to pay them, irregardless of the other demands on your budget.  

If you look at what you own and your sources of income, it may be that everything you have is exempt.  In that case, even if an unpaid creditor sued you, got a judgment and tried to use the law to collect its money, that creditor will get nothing.

So, resist being pressured to pay money just because a bill collector says you "have to".


  Who to pay when you can't pay everyone

  Dangers of debt management programs

  Links to resources on money, credit and the elderly    

  Considering bankruptcy  

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