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Bankruptcy is a waste of money for seniors whose entire income is from sources exempt from civil process. Some state an intolerance for collection activity as a reason to file BK, but an unlisted number and caller ID are much cheaper than a BK attorney.
It's true that debt doesn't go away without filing BK. But the Federal Credit Reporting Act and the Statute of Limitations for filing lawsuits, make old debts meaningless for practical purposes.
You're 86 years old, just stop paying the debt and keep your money in cash to pay your living expenses and dont worry about it. To be upfront you dont have too many years left, so just enjoy life.
This is what I'd do, but I'd probably start at around 70ish
I am basically in the same position as the OP but living overseas. My world financially went bust with the big bust in 09, tried paying things off but used all my savings, finally just stopped paying and notified most creditors by mail and returned their cards. I still maintain a bank account in the US to receive my SS and small pension and to pay my medicare and insurance (in case I ever have to use it). No balance there to speak of except to maintain the account.
Now, I am told, there is a very vague posibility of my recieving a small inheritance from a deceased friend which would not amount to much more than what the average worker receives for a year but which would make my life much easier. Would those creditors be able to attach those funds and would appreciate anyone's thoughts on how to handle the situation.
First thing: The 'money' that you owe your creditors really never existed. The Federal Reserve creates money out of thin air, and the creditors that 'loaned' the money were never really in possession of it to begin with. At the most, about 10 cents out of every dollar existed. The US is a nation of debt, built on debt and will always be in debt. As long as the Federal Reserve and fractional reserve banking exists: the money just is not real.
As far as the small inheritance you mentioned. If it is small, then it would not make sense for your friend to put it into any type of trust which would essentially keep your creditors away from it. With that said, once you have the money, your creditors, although having a legal right to it still have to go through the correct channels to get the money and the system is set up so that it is often hard for them to do that - after all the system is set up to keep people in debt.
When your friend passes away, if he/she leaves some of it to you, your creditors will not know that at the time you receive the money. Simply get it and put it in a bank where you are living now. Most of your creditors and or collection agencies, if you do not claim bankruptcy are probably waiting for the seven year period (most states) to be able to write off the debt in the same manner as if you did claim bankruptcy.
Your creditors had to essentially borrow money to be able to loan it out - so aside from the small amount of reserves a bank needs to have which is only about 10% at this point, your creditors were bankrupt the minute they started making loans.
My understanding is they May Not attach you Social Security "Check" , But one the SS check get intermingled with "Other" money they can attach it.
I would suggest keeping two accounts, One for SS only, One for everything else. Keep the Everything Else at the Min Balance (Many Credit Unions allow for very low min balances). As soon as your Pension EFT arrives, pull the money out of the US bank and keep it in your offshore account. Same with the inheritance, deposit, then pull it out as soon as the check clears. It will give anyone who is attempting to attach your "everything else account" a very small window to get it.
How much money are we talking about? It may not be worth there effort for them to go thru the attachment process. (Also you bank is going to charge $50 or so in fees to the collection agency for there efforts in doing the attachment. So if they attach $200, your bank is going to keep $50 for fee's and forward $150 to the collection (who has the attachment judgement, you would be credited with the $150 on the collection effort there).
I am basically in the same position as the OP but living overseas. My world financially went bust with the big bust in 09, tried paying things off but used all my savings, finally just stopped paying and notified most creditors by mail and returned their cards. I still maintain a bank account in the US to receive my SS and small pension and to pay my medicare and insurance (in case I ever have to use it). No balance there to speak of except to maintain the account.
Now, I am told, there is a very vague posibility of my recieving a small inheritance from a deceased friend which would not amount to much more than what the average worker receives for a year but which would make my life much easier. Would those creditors be able to attach those funds and would appreciate anyone's thoughts on how to handle the situation.
Do you not have a bank account in the country you are currently living in?
SS deposited to USA bank account, deposit everything else to your current country bank.
That said, you should pay your creditors.
Even if it's $10 a month.
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Quote:
Originally Posted by OldFartLost
I am basically in the same position as the OP but living overseas. My world financially went bust with the big bust in 09, tried paying things off but used all my savings, finally just stopped paying and notified most creditors by mail and returned their cards. I still maintain a bank account in the US to receive my SS and small pension and to pay my medicare and insurance (in case I ever have to use it). No balance there to speak of except to maintain the account.
Now, I am told, there is a very vague posibility of my recieving a small inheritance from a deceased friend which would not amount to much more than what the average worker receives for a year but which would make my life much easier. Would those creditors be able to attach those funds and would appreciate anyone's thoughts on how to handle the situation.
Garnishing SS from a bank account is not allowed as long as the SS is direct deposited. In general you're allowed to have two months worth of SS in your account that cannot be garnished. If a person has more than two months worth of 'SS funds' in the account then they may be able to garnish the excess SS. (when I'm talking excess I'm not talking about SS and pension, I'm talking about excess SS only)
Most pensions also cannot be garnished, you should check to see if your pension is exempt.
As far as co-mingled funds in your account, even if you put in money from another source other than SS and the pension, the two months (or less) of SS that had been direct deposited and the qualifying pension can still not be garnished. Not too long ago SS had beefed up the rules and now banks are supposed to safeguard direct deposited SS. If they get a garnishment writ then the bank is supposed to do a two month look back to see if the funds are exempt, and protect what is exempt. They can allow the non-exempt funds to be garnished, but not the qualifying exempt SS funds (not sure if the bank will protect your qualifying pension deposits though). But with that being said, never completely depend on the bank to do what they are required to do, you need to keep track of what's going on in your bank account. If the bank slips up then you need to contact the bank, and, file an exemption with the court.
If you're living overseas, why are you keeping a bank account in this country?
There are many countries where direct depositing a SS check into a bank in that country is allowed, you should check to see if SS will allow direct deposit to a bank in the country where you're living. You should check out the same with your pension check.
As for the possible inheritance check, why not simply have them mail the check directly to you, in the country where you're at, and then deposit it into your other country bank account ... you shouldn't have any problems if you go that route.
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