Everyone is the United States seems to be in credit card debt. While the majority of people with credit card debt problems are the average Americans who are working a 9-5 job, a small percentage of debtors belong to the elderly and the disabled. With their current conditions, they are not in the position to generate income to pay off their debts, unless of course they have a huge bank account.
That being said, do the elderly and the disabled have the necessary protection from creditors who are after their money? Do they have debt relief programs that would help them settle their debts and let them live a life of financial freedom?
To a point, yes. Debt relief settlement allows the seniors and the disabled to negotiate with the crediting firms to make an arrangement, like arranging a more comfortable payment scheme or agreeing on a lump sum, to settle an overdue debt. These relief methods will likely decrease the overall debt owed by the debtor to as much as 70%.
Some financial companies prefer to chase debtors, even those who are advanced in age and the handicapped, to court so they can get their money. While this move is within the rights of creditors, the senior citizens and the disabled are still protected by law when it comes to these pursuing creditors.
When a creditor wins a debt settlement case in court, they have to execute the judgment to collect the money and the most common method used legally is wage garnishing. This type of collection occurs when the creditor automatically deducts a certain percentage from a person's pay and this will go on until the debt is settled.
However, majority of the elderly and the disabled get their income from the social security, pension, and/or disability benefits. There is no way for creditors to extract amount from these sources, even if they won the case. In a way, the seniors and the disabled sector are still protected from pursuing lenders.
That said, it is still best to settle a debt account, even if you feel protected by the law. Having a bad credit line leaves a negative mark on any person, despite their age and capabilities. It is best that people consult debt relief companies for help in these areas.
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Can credit card debt transfer to your children after your death?
An older family member of mine has a large amount of credit card debt and their only major asset is the house that they currently live in. From what I've read it seems that creditors will liquidate all of their assets including the house in order to try and cover the debt upon their death.
One of their children wants to purchase the house or assume the mortgage from them now and become the new owner. If the house is sold/transferred in this manner and no longer belongs to my older family member with the large debt, will creditors try to come after her child upon her death?
The house is located in Florida.
Answer
They better transfer the house before the death of this individual because you are right they will come after the estate of the deceased.
If the child purchases the house from them the seller needs to keep the money out of the banking system otherwise that money would now be the asset. But I'm sure you already know that.
Once the person is deceased the only thing the child needs to do is open the letters send a copy of the death cert. (it doesn't have to be certified unless they contact them and ask for one) and also include a note that says Deceased has no estate.
I've never after 2 1/2 yrs had any of my father in laws creditors write me again.
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