I am a 61 year old, single woman up to my eyeballs in debt. I am also considered disabled by the Social Security Administration and effective 2/1/08 will begin receiving monthly benefit checks from them. I have no assets. One creditor has threatened to get a judgment against me. I gather no creditor can garnish the benefits I get from Social Security. Where do I go from here? Should I write a letter to each creditor making them aware of the above and hopefully that will back them off? The benefit check I will get from Social Security is what keeps me from becoming homeless.
Yes, you are correct. Social security cannot be garnished.
Since you state that you have no assets and you are on Social Security disability income, my suggestion is to try see if you qualify for a debt settlement program.
Debt settlement involves many facets - including personal financial discipline and budgeting (to save for the settlements), negotiations and leverage with the creditors, dealing with the potential for collection calls and maybe even fighting off a lawsuit.
If you would like to get help from a pre-approved debt settlement company, please contact a counselor - Bills.com has several online, click here: Debt Relief Savings Quote
If you want to contact a particular firm, Bill is friends with the good folks at Freedom Debt Relief. They are a good organization and are members of the Better Business Bureaus. They can be reached at 1-800-544-7211 or by clicking here: Freedom Debt Relief
Generally, I would make sure that any firm you choose is a member of the Better Business Bureau and get a sense for the quality of the organization (www.bbb.org).
Now a little bit about how settlement works. Rather than making monthly payments to your creditors, these programs negotiate lump sum settlements with your creditors, frequently reducing your debts by 50% to 60% of your principal balances. These programs usually take only 2-3 years to complete, so this is a good option for many people to rid themselves of debt in a relatively speedy manner. In many cases they can also reduce your monthly payment toward your debt.
In case you are unable to afford the payments for even a settlement program, then bankruptcy might be the only option. You can speak with a qualified bankruptcy attorney to discuss the relief available to you in bankruptcy.
Consulting with an attorney does not mean you are going to file bankruptcy, but it will help you better understand the options available to you in case debt settlement does not work out.
For more information about bankruptcy, I invite you to visit the Bills.com Bankruptcy Information page. A qualified bankruptcy attorney should also be able to carefully analyze each aspect of your financial situation to advise what non-bankruptcy solutions may help you.
I hope that one of the options that I have stated will help you with your debt problems and help you Find. Learn. Save.