Disability income only (can they still collect?)

by Don
(Murray KY.)

I am 50 years old and have been disabled by a neurological disorder that is a progressive disease. I live in Kentucky.

Before I became disabled, I did have very good credit. Qualifying for disability took over 2 years, (with $0.00 income). Now my only source of income now is disability income, and is less than $1000.00 monthly.

This debt collector is trying to collect a $400.00 dollar debt.

I was told by a credit counseling agency that they can not collect or garnish your disability income.

Is this true, partially true, or false? Thank you very much for any information you can provide.

Reply from DebtCollectionAnswers.com:

We're so sorry to hear what you are dealing with.

You got some good advice. Generally disability income is safe from creditors except for certain types of federal debts.

If you can't pay the collector and you don't believe there is anything they really do to compel you to pay then you can send them a cease contact letter and ask them not to contact you again.

They may just stop trying to collect or it's possible they will sell the debt to someone else - so be sure to keep records of all your correspondence about this debt.

Please keep in mind we cannot offer legal advice. If you have questions about your legal rights contact a consumer law attorney.

Comments for Disability income only (can they still collect?)

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Nov 24, 2012
by: Don

Thank you for your time and effort, it is greatly appreciated.This is now the third time I've gotten this answer to my question, but when I found your web site, I just wanted to be sure.

As to any Federal debt, no I don't have any debt owed to any Federal agency. This was an unsecured credit account, which I initially only owed $75.00, they kept it for many years, to total over $400.00 and now feel they need to collect.

To this date, I've not had anyone threatening to sue me to recover a debt, just many phone calls, which have become annoying to no end.
I've even told them my only income was from Disability, and could barely live on what I receive.

This made no difference to them, and continue to call.

Thank you again!

Jan 03, 2014
Summons for Eviction for HOA debt.
by: Anonymous

I'm on SSDI & got a summons for eviction for HOA debt How much time can a judge give me to settle this bill?

Reply from DebtcollectionAnswers.com

We'd really recommend you talk with an attorney for legal advice to see if you can stay in your home. You should be able to get help from legal aid given your financial situation. You can find out more on this page: How to get debt collection legal help for FREE or at little cost.

Mar 19, 2014
keep your bank account single to protect it
by: Anonymous

If it is just credit card debt and not IRS, then they cannot get any of your disability or social security . They can still levy your account if they get a court judgement, but if you keep the amount in your account the same or under what you get in benefits per month, not over that, then they can't take anything from your account.

Also, make sure that you aren't using your account for other things, such as deposits from side jobs or checks you deposit from other sources beside benefit checks that would cause your account to be mixed, and if you have a joint account, just put it in your name only. Your bank should be able to explain this to you more. It is not legal for collectors to get disability money from a bank account.

Dec 16, 2014
Disability income is exempt from judgment
by: Anonymous

SSD is 100% exempt. I had a debt collector get a judgment against me and my only source of income was SSD. When I contacted them, I spoke to their legal department and their lawyer informed me that the money was exempt. All I had to provide was copies of 3 months of bank statements to show that SSD was in fact the only income going into the account(s). Once this is verified, they will release the account. In some cases, and this depends on the bank, if you contact your bank's legal department they will investigate and make the determination of income and release the account. I am not sure how this is handled when there are other sources of income in addition to SSD going into the account. Also bear in mind that debt collectors often don't know what the source of income is before they go to court, so this is what would occur if they do and get a successful judgment. The best thing to do is if you are contacted by a debt collector, don't acknowledge ownership of the debt, ask for verification of the debt and let them know that you are an SSD recipient and can't afford to just hand your money over based on a phone call.

Jan 22, 2015
Dept paid in full 13 years ago by garnishing my pay check
by: Anonymous

This debt was paid in full and is in my TRW shown as paid in by an apartment I had rented over 13 years ago. Now they are coming back stating it was not paid this is all recorded by the company I worked for. Can they renew the debt that was already paid in full? I just receive court papers stating I owed when it was paid in full the apartment complex renewed is that legal?

Reply from DebtCollectionAnswers.com

We're sorry but we don't understand the scenario you are describing. But since you've been served with court papers it would be wise for you to at least talk with a consumer law attorney to find out how to respond. If you fail to show up in court you could wind up with a default judgement against you.

Mar 02, 2015
full retirement age disability benefits become SSI
by: john

Can Treasury claim my SSI benefits as income stream that they can attach or lien to satisfy school loans forgiven under total and permanent disability?

Reply from DebtCollectionAnswers.com

Why are they trying to collect forgiven debts?

Mar 15, 2015
SSDI is Protected Under Federal Law
by: Erin

Yes, SSDI, Veterans benefits, Railroad Worker's pension and other specific types of income are legally protected under both federal and state laws from garnishment and have been for decades.

Because the banks ignored this and whined that they "must comply" with a court ordered Writ of Garnishment (WOG) there was a federal law passed in 2011 that clearly and specificly states the precise steps that a bank (or any financial institution) MUST take when they receive a WOG.

To begin, the banks are required to flag all direct deposit accounts that qualify under the exemption. When they receive a WOG they MUST determine if the funds in the account in question are exempt from garnishment under federal law. If they are exempt the bank then must apply the Look Back requirement.

The Look Back requirement states that the bank will total all (exempt) deposits made in the previous 2 months. If the current balance is equal to or less than that total, the bank shall not freeze and the creditor will NOT get a penny. This is to insure the account holder has access to 2 months worth of funds to live on. Keep in mind the following.

If your account balance exceeds the 2 month look-back (exempt deposits) total the bank is allowed to freeze the excess and it will be garnished. Therefore DO NOT ever let your account balance exceed the total of the previous 2 months worth of (exempt) deposits.

I keep putting 'exempt' in parens because the federal law protects -only- funds that are deemed legally exempt. That said, don't ever commingle exempt and non-exempt funds in the same account. Keep only, your exempt direct deposit funds in an account that's completely separate from any other (business, savings, etc.) account.

I receive a legally exempt pension and prior to the added protections of the federal 2011 exemption law my bank allowed a corrupt attorney (now disbarred in my state) to relieve me of several thousand dollars. There are banks who are ignorant of or refuse to comply with the federal law. Make sure your bank flagged your account and is aware of the law. As a precaution don't rely on it to protect your account. If served with a WOG immediately, file a Notice of Exemption with the respective court. Protect yourself from greed, ignorance and on-compliance. God bless.

Jul 10, 2015
please help
by: Anonymous

I have been disabled all my life I also have epilepsy I'm on disability they want to take me to court. I haven't gotten a bill in over a year what should I do? I am being sued can my witch only seven hundred and thirty three dollars a month and is my only income can it be garnished...?

Reply from DebtCollectionAnswers.com:

If you have not already been sued then keep in mind that if you are sued and they get a judgment your Social Security disability income should be safe. But your best bet, if possible, is to talk with a consumer law attorney to make sure you fully understand your rights and how to protect yourself. It sounds like you would very likely be eligible for Legal Aid. Get free legal advice about debt collection here.

PS: Apologies we didn't see your question sooner - we get hundreds of questions each week.

Aug 27, 2015
100% Disability Income is NOT garnishable/touchable
by: Anonymous

I receive both 100% VA and SSD after serving 21yrs in the Navy. Presently AMEX is after me for nearly $20k ..Gold Credit Card.

I am lucky enough to live in NC, where the taking of wages is considered heresy, however, I've already been advised by both The VA and SS that neither of my incomes can be remotely touched, and as long as it can be shown that any 'extra' that exists in my bank account is FROM MY EXEMPTED INCOMES ...then that means "they" are not privy to it.

Can they lien my house? I've no idea. My car? I've no idea ...but I guess I'm going to find out since the first payment they are seeking is only $6,355.54! (I was expecting a bill for a bit under 2 grand so you can imagine the mess this has turned into ...and AMEX literally caused the entire mess to being with ...hence my hesitation to pay.

PS: VA and SS disability pay is 100% INSULATED AND PROTECTED by the feds. The ONLY exceptions are: Back Alimony, Back Child Support, Federal Overpayment. END OF EXCEPTIONS/NO OTHERS

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