Credit Card Debt & Foreclosure Advice

Will I have to give up my home because of credit card debt?

Will I have to give up my home because of credit card debt?

Read full question
Bill's Answer
4.0
/5.0
(6 Votes)
Bills.com Team
Pro

By

Highlights


  • Credit card debt may lead to home foreclosure, but this is rare.
  • Creditors can garnish wages, levy bank accounts, and place liens on property.
  • Learn your rights and liabilities under your state's laws.

The answer is most likely no, a delinquent credit card debt will not cause you to lose your home to foreclosure.

Very few consumers lose their homes because of delinquent credit card debt. In fact, I would say that it almost never happens, except in certain bankruptcy cases in which the consumers voluntarily gives up his or her home. Although forcing the sale of a consumer’s home due to credit card debt is technically possible in some states, it is a very costly and risky undertaking for creditors.

In addition, forcing the sale of debtors’ homes would be extremely bad public relations, as many people would be much less likely to use credit cards if they thought their use may result in them to losing their homes.

Unless your financial situation is somewhat extraordinary, you probably do not need to worry about losing your home due to credit card debt. Only if you own your home outright, or if you have a very large amount of equity in the house, could the taking of your home become a concern. Even in those cases, it is extremely unusual for credit card companies to seize property due to the time and cost involved.

Before going into detail, I can advise you to seek a debt consultation to see if you can get help with your debts. Bills.com has many pre-qualified debt counselors who can help you sort out your problems. Visit the Bills.com Debt Help page for more information.

Credit Card Foreclosure

Before seizing any property, a credit card company would first need to file a lawsuit against you in your county courts in an attempt to obtain a judgment against you. The court process alone can take many months to complete, and there is no guarantee that the creditor will win a judgment against you, though it probably will win if you owe the debt. Once a creditor obtains a judgment, it can initiate further court proceedings to collect on the judgment.

Although the execution of a judgment could theoretically involve a creditor seizing your home, there are several much easier ways to collect on a judgment which creditors usually prefer. These methods include wage garnishment and levies on bank accounts. Also a creditor with a judgment against you will likely place a lien on your home, meaning that when (or if) you sell or refinance the home, you would be required to pay the judgment out of the proceeds of the sale.

Your state law dictates what methods are available to creditors to collect on judgments. For example, Texas, Pennsylvania, and North and South Carolina do not allow wage garnishment for the collection of most judgments. Keep in mind that before taking any of these actions, a creditor must sue you and be awarded a judgment by a court with jurisdiction over the case, which usually means the courts in your county of residence.

Falling behind on a credit card does not always result in a lawsuit. Many people unable to make their payments suffer nothing worse than collection calls. Also, keep in mind that creditor threatens you with a lawsuit does not mean that they will actually sue you.

Frequently, collectors will threaten people with wage garnishment, bank levies, or even the seizure of a home, even though the collector has absolutely no ability to follow through with the threats. See the Bills.com resource Collections Advice to learn more about your rights in collections.

ach state legislature created unique foreclosure and anti-deficiency laws. Follow the links just mentioned to learn the foreclosure rules relevant to you.

Why a Creditor May Not Try to Seize Your Home

If a creditor with a judgment against you wanted to seize you home, it would first be required to pay off any mortgages or home equity loans you have on the home. Only after paying off the secured creditors could the credit card company sell the home at auction. Since auctions frequently bring less than half of the actual value of the home, creditors are taking a huge risk. Since they must pay the mortgage company up front for the entire amount owed on the mortgage, if the home brings less than expected at mortgage, they can actually lose money on the deal.

In addition, almost all states exempt a certain portion of the equity in a home from creditor execution; this amount ranges from $5,000 in some states to several hundred thousand dollars in others. If a creditor sells your home at auction, they must pay you your exemption amount, regardless of whether or not the creditor made that much money at the sale.

As you can see, this is a complicated and risky proposition for creditors, which is why it is almost unheard of for a consumer to have his or her home seized to repay delinquent credit card debt. Some states, such as Texas, do not allow creditors to seize primary residences to repay judgments regardless of the amount of equity in the home.

If you are being sued by a creditor, or think that a lawsuit may be filed against you in the near future, you should consult with an attorney to discuss your states exemption laws and what action a creditor could take against you under those laws, and what you can do to protect yourself. After speaking with an attorney, some consumers find that they are "judgment proof," meaning they have no assets a creditor could take to repay a judgment against them. This is especially common among elderly and disabled individuals.

The bottom line is that, while possible legally in some states, it is unlikely a creditor will take your home to repay your credit card debts. However, as mentioned before, creditors will take other actions to collect on delinquent accounts, so you should look into ways to resolve your debts if you are struggling to repay them.

Debt distressing you? The Bills.com Debt Coach is a no-cost online tool that will analyze your debts and show you the options available to resolve them and the costs and benefits of each.

Debt Resolution Options

The first option that comes to many people’s minds is bankruptcy — if you are considering bankruptcy, I encourage you to consult with a qualified bankruptcy attorney in your area to find out if filing bankruptcy is a viable options for you.

If you find that you cannot file bankruptcy, or simply do not want to file, there are several alternatives available, such as consumer credit counseling and debt settlement. To read more about these options, I invite you to visit the Bills.com Debt Help page.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com

63 Comments

Recent Best
1500 characters remaining
  • 35x35
    Feb, 2012
    Anthony
    Hello Bill, My question is regarding forclosure due to delinquent property taxes. I was laid off for a year now and have fallen behind on taxes. I have until October 2012 to pay two years of delinquent taxes or be foreclosed on. Can I file bankruptcy and add the taxes on it? or will the tax company who bought it able to do a 5 year plan alone with me? Also, If they do take property and I do not file chapter 13 due to being unemployed and not approved, will I still get my 15,000 exeption homestead in Illinois? Thank You, Anthony
    0 Votes

    • 35x35
      Feb, 2012
      Bill
      Anthony, because your house is at risk, I strongly advise you to seek professional legal advice. If you can't afford to pay for it, seek legal aid through Illinois Legal Aid.

      I don't think a long-term payment plan will be offered on your delinquent property taxes. I also do not believe that you can discharge the debt in bankruptcy, though you should discuss that with a bankruptcy attorney, as well as whether filing for BK can delay any actions against you.

      I do believe that your homestead exemption applies, but as I am not able to give you legal advice, please also discuss this with an attorney.
      0 Votes

  • 35x35
    Feb, 2012
    brittany
    I live in NC and have a lien against my car for some bad credit card debt. Can they take my tax refund to pay this debt?
    0 Votes

    • 35x35
      Feb, 2012
      Bill
      Private judgment-creditors do not have an inside track with the IRS. What you suggested does not occur. You mentioned North Carolina. See the Bills.com resource North Carolina Collection Laws to learn more.
      0 Votes

  • 35x35
    Jan, 2012
    J
    I was in a car accident in 2003, and my lawyer said he would take care of my creditors. Now, after 9 years, I received a letter saying I owe almost double the original debt. I own a mobile home and property that is on my name and a friend's name. Can they put a lien or anything on my property?
    0 Votes

    • 35x35
      Jan, 2012
      Bill
      You indicated you reside in Louisiana. Louisiana law is unique among the 50 states because it is based on Napoleonic code, (the French civil code), Roman law, and Spanish civil law. The other states are rooted in English common law. I barely scratched the surface studying Louisiana law, and would be doing you a disservice by guessing at your rights and liabilities. Consult with a Louisiana lawyer who has consumer law or civil litigation experience. Please return here to share what you learned.

      In the meantime, validate the debt because a debt that cannot be validated may not be collected.
      0 Votes

  • 35x35
    Dec, 2011
    Killermery
    I live in Texas I have a debt of $4000, I try to work a payment plan with the collectors, but they told me I had intill the end of the year or they will place a lean on my house I am still paying for and don't want to sell. This calls just started a couple of weeks ago and I haven't receive any letters from them in the mail. Can they do that?
    0 Votes

    • 35x35
      Dec, 2011
      Bill
      A lender or collection agency can place a lien on your property only after they receive a court judgment in their favor. I recommend that you read about collection laws in Texas. This article will help you understand the tools available to your creditor. For example, Texas does not allow, in general, wage garnishments.

      The collection agency is obliged to work within the framework of the law, in a fair manner. Read Bill.com article about collections advice.

      It is my understanding that, in Texas, you can have a lien against your home removed, through the local county court, due to the home being your homestead and the exemptions in Texas. I believe that even if you sell the house and there was a lien present that you can keep the proceeds from the sale and they are protected for up to 90 days from garnishment. I am not an attorney, so you should speak with one if you want an authoritative answer.
      0 Votes

  • 35x35
    Dec, 2011
    Andrea Vanizu
    Hello, My uncle made a contract with a law firm to settle his credit card debt. He had to conform to 3 payments. He made the first one but unfortunately was unable to make the second one. Now the law firm is refusing to make an adjustment and are threatening to sue him in court. If he was taken to court can the judge ask the law firm to consider a new arrangement plan since he was willing to make the payments instead of wage garnishing and the other consequences. Thank You.
    1 Votes

    • 35x35
      Dec, 2011
      Bill
      As your uncle defaulted on the payment arrangements he set up with the law firm, it seems the likeliest event, if the law firm does sue him, is that a judgment will be entered against him. A judgment could lead to a wage garnishment and a bank levy, depending on the state collection laws.

      Because the law firm is threatening to sue him, but has yet to do so, he should try again to work out a payment schedule before he is sued.
      0 Votes

  • 35x35
    Nov, 2011
    serena
    I received a collection call from a credit card debt of five thousand dollars. I agreed to payment arrangements with the collection company but refused to have the money drafted from my checking account. The collection agency than refused to speak to me any longer. Told me to either get a lawyer or file bankruptcy and dismissed the payment arrangement that we both agreed on. He said I could not be trusted to pay on my own. I am afraid that now he will sue me for payment. Can they do this even after I agreed to pay? He said I have 24 hrs to give them permission to go into my bank account. And the entire conversation was recorded.
    0 Votes

    • 35x35
      Nov, 2011
      Bill
      Bills.com has received enough messages from people who have agreed to allow a collection agent make an ACH withdrawal from their accounts for $X, and then the collection agent withdraws "$X+much more" that I discourage the practice. Send the collection agent a money order or certified check, which are much more difficult to alter than a personal check.

      But before you send the collection agent a penny, read the following Bills.com resources:

      One last thought: Recommending someone file bankruptcy may be considered legal advice. The last person a consumer should accept legal advice from is a collection agent. Read the links I mentioned above to arm yourself with knowledge of your rights and liabilities so that you can decide whether bankruptcy is a viable strategy for your situation.

      0 Votes

  • 35x35
    Oct, 2011
    Sasha
    Hi, I made arrangements with a debt collector to pay on one of my credit cards. After making arrangements, I received notification that they are suing me. Since making the arrangements I have been paying them everyone month the amount we agreed upon as they are automatically taking it out of my bank account. Why are they still trying to pursue me in court, if I have already made arrangements and I am living up to the agreement we have made?
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      I can only surmise that you did not get an agreement in writing. It may be a case where one hand does not know what the other is doing. Start by speaking to the collector, explaining the situation and hearing what they have to say. If the collector is inflexible you can try explaining your side in court, but the collector may deny that any formal arrangement was in place, if you lack the ability to prove that it was. It does seem that your allowing automatic deductions from your account is one piece of evidence, but I can't say whether or not it is enough to prove that a formal agreement existed.

      I can't explain why the collector is acting this way, but it may be a case of lack of ethics and greed. It is not fair to break an arrangement the two of you made, but the collector may be doing so in order to collect more money from you more quickly. Your situation is a reminder to get all agreements in writing.
      0 Votes

  • 35x35
    Oct, 2011
    Cristy
    My father was diagnosed with cancer and my parents have over $30,000 in credit card bills. They also have a mortgage they are paying. They cant pay the credit card bills will they be forced to sell the house? Should i continue paying the min amnts on the cards?
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      As I tried to convey in the original answer above, there is not a direct path from credit card default to home foreclosure. Please reread the original answer above to gain a better understanding of what happens during the collections process. See also the Bills.com resource Collections Advice to learn more details about collections.

      You asked if you should continue to pay the minimum balances on their credit cards. I cannot answer that question without learning more about your parents finances and their goals. Consult with a lawyer who has wills, trusts, and estate planning experience. You may say, "My parents do not own all that much." That may be true, but a lawyer with estate planning experience will look at the big picture, including the credit card debt and mortgage, and recommend a plan for resolving the debt with a minimum of liability for the family and each spouse.

      I realize this may not be the answer you were seeking. However, your parents need a good plan that takes into account their entire situation, and not a quick yes or no or a snappy one-line answer.
      0 Votes

  • 35x35
    Aug, 2011
    sean
    My car and home is titled in my name as well as my girlfriends. I have an outstanding debt of 8,000 to a collection agency. They have a judgment against me from 9 years ago. Can they repo my car or put a lein on our home?
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      They cannot take property or garnish wages without first obtaining a judgment against you and then applying that judgement.
      0 Votes

  • 35x35
    Aug, 2011
    Chuck
    I live in Texas and recently took a major salary cut. Needless to say, I fell way behind on my bills. One of my credit cards has served me with papers and is taking me to court to place a judgment on me. I don.t have any money to pay them. What is going to happen?
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      Texas has very strong wage protections for collection of a credit card debt, so a wage garnishment is not a major concern. (If you are paid by an out-of-state entity, it could be more complicated.)

      A bigger concern, if a judgment is entered against you is a bank levy. Keep funds to a minimum, if you receive a judgment.

      Because of Texas' wage protections, you are in a favorable position to negotiate a debt settlement, even post-judgment.
      0 Votes

  • 35x35
    May, 2011
    Cindy
    my husband and i own a home outright for approximately 150,000. Our son ran up 50,000 in credit card debt. we would like to move but are not sure if we would have to pay the credit cards off first.
    0 Votes

    • 35x35
      May, 2011
      Bill
      There is no feudal debt bondage in the United States. You are not responsible for your children's debts, and your children are not responsible for yours.

      If you or your spouse are co-signatories on the loan contracts, then that co-signatory has personal liability for the debt. However, if for the sake of argument one of you cosigned on a loan, that will have no impact on your ability to sell your personal or real property.
      0 Votes

    • 35x35
      Jun, 2011
      Tammi
      I have a $4000 delinquent credit card account due to my ex- husband using my information to obtain and use the card. there is no way for me to prove it and it is solely in my name. I currently have no job, income, bank accounts, or assets. This was over 3 years ago and I have since re-married. Can they go after my husband for money if I don't have it?
      0 Votes

    • 35x35
      Jun, 2011
      Bill
      If the creditor sued you and obtained a judgment against you, a bank account that you share with your current spouse could be at risk. Your spouse's income is not at risk for garnishment, because he is not responsible for the debt. These are the general rules that apply in most states.

      The rules in community property states may be different. In California, for instance, which is a community property state, premarital debt can be collected from community assets, including the non-debtor spouse's income. If you live in a community property state, consult with an attorney to determine whether your spouse's income is at risk.
      0 Votes

  • 35x35
    Nov, 2010
    Dee
    We live in Wyoming & accumulated credit card debt in another state. I still cannot pay this debt & they are threatening to FORCE THE SALE of our modest house. Is this legal in Wyoming?
    0 Votes

    • 35x35
      Nov, 2010
      Bill
      A collection agent is not your attorney. Do not believe legal advice from someone trying to collect money from you, unless that person is your attorney. Collection agents routinely dispense incorrect or incomplete legal advice, and that advice is always self serving.

      Consult with a Wyoming attorney who has experience with real estate or bankruptcy law. I am not suggesting bankruptcy is your only option, but an attorney with either bankruptcy or real property experience will help you file a Wyoming homestead exemption for your house, which will help protect the first $10,000 of its value from creditors' claims. If I understand Wyoming law correctly, a creditor may not foreclose for credit card debt. However, I urge you to consult with a Wyoming attorney to understand your rights and liabilities.
      0 Votes

  • 35x35
    Sep, 2010
    Laura
    Wells Fargo suddenly raised my credit card interest and payment so high that I could not afford it. It jeopardized my ability to pay my Wells Fargo Mortgage. I tried to negotiate with the Credit Card dept. and they refused, gave the case to their collection attorney, took me to court, then garnished me to the point where it PUT ME IN A POSITION OF "FORECLOSURE" ON MY WELLS FARGO MORTGAGE. Have any of you had this happen?
    0 Votes

  • 35x35
    Aug, 2010
    Bill
    Yes, attend the hearing and plead your case. You may not prevail, but at least you will have a chance to be heard. Also, there is a small chance the plaintiff may not appear, and if that is the case you will win by default. Regarding your garnishment question, see the Bills.com resource Texas Collection Laws to learn more about your rights and liabilities in Texas.
    1 Votes

  • 35x35
    Aug, 2010
    Prem
    I am a texas resident and have been served with a notice for "Summary of judgement" in court by the LOC bank attorney on my line of credit which i am not able to pay with my present financial situation. Should i attend the hearing? or what do i do to avoid it. Will they put wage garnishment etc after obtaining a default judgement? Pl help. Thanks,
    0 Votes

  • 35x35
    Jul, 2010
    Bill
    It's called CODI or cancellation of debt income. You don't have to pay it if you were insolvent at the time of settlement. Make sure that when you prepare your taxes that you have your accountant review the CODI forms.
    0 Votes

  • 35x35
    Jul, 2010
    tamra
    I live in Texas. I have heard that if you settle with a credit card company for less than what is owed, then you have to list the difference that you saved as income for the following tax return. Is this true?
    0 Votes

  • 35x35
    Jun, 2010
    Bill
    Foreclosure laws are state-specific, and you did not mention where the house is situated. You mentioned the foreclosure process is far along, which gives me pause. Therefore, consult with an attorney in your state immediately.
    0 Votes

  • 35x35
    Jun, 2010
    Ann
    My sister was very ill and lost income as a self-employed individual over 3 years. Her home is going into foreclosure. Can I buy it from her or go to the bank and request it be transferred into my name to help her to save her home? If she 'gifts' me the house and then I pay the back bills on it can this save the house? Or if she sell sit to me for whatever she owes the bank can I keep it out of foreclosure? I want to help her however I can. However the foreclosure is very far along. How can I stop the bank?
    0 Votes

  • 35x35
    Jun, 2010
    Bill
    I agree with your conclusion -- the foreclosure will damage your credit score, and defaulting on credit cards will make a bad situation worse, but not that much worse relatively speaking. Negotiating settlements after charge off either yourself or with the help of a service provider is a good way to achieve debt freedom quickly.
    0 Votes

  • 35x35
    Jun, 2010
    el
    we relocated to another state NC. Our home in AZ is being short saled, but it will probably will foreclose. We have appox 12K in CC debt. Should we let this go to charge of and deal with the creditors at that moment as to accept a lower amount owed? Since we now live in NC they cannot go after wages. Not sure what to do because our credit is hit either way with the foreclosure so what is another CC mispayment going to do to it? PLease help!
    0 Votes

  • 35x35
    Jun, 2010
    Bill
    I do not see that unsecured creditors have the right to place a lien on real property and then foreclose under Michigan law. I hasten to add, however, that I am not a Michigan attorney and my understanding of Michigan law is slight. Consult with a Michigan attorney who can learn more about your circumstances and give you a precise answer.
    0 Votes

  • 35x35
    Jun, 2010
    Jon
    If I have prior CC debt and I buy a home 30% greater than my debt, in MI can they legally sieze or force the sale of my home?
    0 Votes

  • 35x35
    May, 2010
    chuck
    Next Tuesday I go for Case management conference. What happens at this court meeting and what should I and should I not say?
    0 Votes

  • 35x35
    May, 2010
    Bill
    That is an unfair question because I know nothing about your situation. Find an attorney. He or she will review your entire situation, ask probing questions, explain your options, and represent you if you so choose.
    0 Votes

  • 35x35
    Mar, 2010
    Bill
    It is possible to discuss the rights of creditors, but predicting if a creditor will exercise those rights in one particular situation is impossible. Please reread the article above for a discussion of the issues you raise in your question.
    1 Votes

  • 35x35
    Mar, 2010
    michele
    I live in Nevada and owe more on my property than it's worth. I own my house out-right in California. I ran up about $52,000 in debt all is under $10,000, except one is $11,000. Can they foreclose on my paid-off property? These cards are under my name only.
    2 Votes

  • 35x35
    Feb, 2010
    Bill
    See the Bills.com resource Is My Spouse Liable for My Credit Card Debt? for a discussion of the issues involved in your question.
    0 Votes

  • 35x35
    Feb, 2010
    Mr.
    I am going to court to fight an old debt, over 7 years old, a debt for about $2000. I filed a validation or verification of this debt, if they come up with verification and I lose, can the collection agency seize my wife's personal bank account or even her security deposit box. Could they even garnish her wages? They can't garnish mine because I am self employed...
    0 Votes

  • 35x35
    Feb, 2010
    Bill
    See What Are My Debt Resolution Options? to learn the alternatives to bankruptcy, and the strengths and weaknesses of each option.
    0 Votes

  • 35x35
    Feb, 2010
    toni
    My elderly mother lives on social security she is in debt of $10,000.00 credit card debt> she make payments on time but does not have enough money to eat on. fixed income, i know she cannor keep going on this way. what are her options other thatn bankrupcy?
    0 Votes

  • 35x35
    Oct, 2009
    Bill
    I don't see a means for the creditor to reverse your selling or gifting real property to anyone, even if you knew you were about to be served a summons. I suppose maybe if you bought the house with the credit card in question they may have a claim of some kind, but even in that circumstance I am hard-pressed to find a legal theory to apply that gives the credit card issuer a claim.
    0 Votes

  • 35x35
    Oct, 2009
    Ken
    Hello, transferred my home to my sister. Week later I recieve a credit card summons, abritatratiion no judge. They won the judgement. Can they reverse the transferr of my home to my sister. I was never contacted by the collector in anyway just recieved the summons. So at the time of transfer I was unaware of being sued. In this case they filed in late June, transferred the house July 1st recieved there summons July 7th? As I mentioned I never new the lawsuit was filed until I recieved the summons. Thank you so much.. Ken
    0 Votes

  • 35x35
    Mar, 2009
    worried
    I am being sued by a collection agency over a credit card. If they win a judgement, which they will, can they put a lein on my home which is in mine and my husband's name BUT my husband's name IS NOT on the credit card? Will Tenancy in the Entirety protect from leins?
    0 Votes

  • 35x35
    Mar, 2009
    Bill
    First of all it will depend on the state laws as to whether they can put a lien on your home. Please look up your state information here: http://www.bills.com/collection-laws/. Secondly, if they were to put a lien on your home, the fact the your name is on the property documents is enough for them to put a lien.
    0 Votes

  • 35x35
    Jun, 2008
    Nithin
    No, the credit card companies cannot directly force you into a foreclosure. But depending on state law, they might be able to put a lien on your home, which would mean that if you ever sell the home or opt for a refinance, they might be able to get their money then. In any case, none of that can happen without a court judgment. You can read more about collections laws at http://www.bills.com/collection-laws/. As far as putting the condo in another person's name, I think the best place to get advice would be your current mortgage company.
    0 Votes

  • 35x35
    Jun, 2008
    Ned
    I owe about $100K in CC debts... I've been perfect in making monthly payments for the past several years, my wife and I currently live outside the USA and, and now our money has run out. My wife and I own a condo in our joint names, probably about 50K of equity in it... The condo is currently rented and the rent pays my mortgage and property taxes... if I simply stop paying my CC debts, but still continue to pay my monthly mortgage, can they force me into foreclosure??? Can I simply (or easily) put the condo in someone else's name (example... parents or siblings) without going through the sale process.
    0 Votes

  • 35x35
    Jun, 2008
    Jason
    In case of default, the available options for credit card companies vary from state to state. In general they cannot touch fixed income such as social security. Although, some states do allow them to put liens on properties, a lien does not mean that they can force you to sell the property, just that they can calim the proceeds of the sale, if and when the home is sold.
    0 Votes

  • 35x35
    Jun, 2008
    belle
    my mother is disabled and elderly (82) and her cc's are $45,000. I am her POA. She owns a small mobile home in Alabama. She cannot afford the cc payments. Will they put a lien on her property? She lives on social security and has no money in th bank.
    0 Votes

  • 35x35
    Jun, 2008
    Nithin
    if a judgment is passed against you, the court might order your wages to be garnished. Although, it depends on your state laws, regarding available avenues for recoveries after a judgment. Please visit http://www.bills.com/collection-laws/ for more information.
    0 Votes

  • 35x35
    Jun, 2008
    lena
    I have a credit card company who is taking me to court in 2 days, and I just learned that my home is in foreclosure. I do not have a job, but my husband is in construction, and therefore, as a result of the economic downturn, we are in a dire financial situation. The home is in mine and my husbands name, and the credit card is in my name. My question is, with absolutely no money in any bank accounts, (we live from check to check) and our home in foreclosure, what can they take in judgment against me? The credit amount, with all the fees for the last 6 years is approx. $6500. (I think it was originally around $2000) I purchased my home in 2005, and it has been losing equity as a result of the housing market slump. I am trying to save my home.
    0 Votes

  • 35x35
    Feb, 2008
    John
    I have approx. $25,000 of credit card debt. I own my home free and clear in Joint Tenancy with my Mother. Value of my home is approx. $400,000. Would the creditor be able to obtain a judgement against my home where there is another person as Joint Tenant? And what are the chances that the creditor would go after my home since it is free and clear with substantial equity? If a judgement is obtained against my home and a lien is placed against it, does interest on the debt continue to acrue until sale of the home?
    0 Votes

  • 35x35
    Feb, 2008
    Nathan
    If the creditor decides to sue you, then the fact that you have a joint tenancy is not going to make a difference. Depending on which state you live in, the creditors have other recourses such as wage garnishment. In the remote scenario that a judgment is given, it is up to the court to decide about freezing the balance or to let the interest accrue. If you are in a position that will be sued, I would strongly suggest that you consult with a qualified attorney licensed to practice in your state. I am in no way a legal expert, so please do not take decisions base solely on my advice.
    0 Votes

  • 35x35
    Dec, 2007
    bradg
    Depending on what state you live in (if it is a community property state), and if the cards are jointly held... you might be liable for the debt. You should discuss with your attorney. As far as your question on liens and your home, first of all - to get a lien the creditors would have to file suit against the cardholder (sounds like your wife and you) and obtain a judgment and only then go back and apply that judgment in the form of a lien against the home. If they have 'won' the lien, then that lien would have to be paid out of the proceeds of a sale (to make the title clean to the next owner).
    1 Votes

  • 35x35
    Dec, 2007
    Todd
    After I filed for separation my soon to be ex-wife ran up nearly $90,000 in credit card debt. I know that I am not liable for the debt, but our home is still in both our names until the final court order and deed is processed. What will happen if a lien is placed on the property before title is transfered to me?
    0 Votes

  • 35x35
    Apr, 2008
    Bill
    Be really careful. Caredit cards almost always have the "Universal Default" clause built into their contract. What this means to you is a drastic increase in your interest rates as and when the foreclosure is reported on your credit reports. This has nothing to do with you having or not having joint accounts with your husband.
    0 Votes

  • 35x35
    Apr, 2008
    janie
    my husband and I are separated he is living in my house and I am living in my condo (both properties) in my name}. If my house was to go to foreclosure would my regular credit cards, macy, kolhs, mastercard ect...be in jeopardy of me using them they are only in my name we have nothing jointly.
    0 Votes

  • 35x35
    Jun, 2008
    Bill
    A credit card judgment is a serious issue, you should try and resolve it as quickly as possible. Collection agencies have legal companies that work for them, which send out so called "legal notices". Be sure to investigate more, as many times, it could just be a letter from a legal firm and not an actual court case. If they did file a legal case against you and if the case had come up for hearing, you would have received a summons from the court. If you receive the summons and yet do not appear in court, then a default judgment will be filed against you. As I said before, you should try as much as possible to avoid a judgment. Speak with the collection agency to work out a payment arrangement or even a one time settlement.
    0 Votes

  • 35x35
    Jun, 2008
    trina
    I let a family member use my credit card when they were in a hard spot and told them that all I asked was for them to pay the bill on time, a year or so went by and I started getting letters from a collection agency that the debt had been bought by them, it's just for a thousand dollars but now they have filled a case in district court, can I ask for a payment arrangement or can they get judgement and garnashe my wages.
    0 Votes