[Rose76]

I became ill and lost my job over a year ago. My doctor advised me to apply for SSDI. I did and my claim got approved real quickly. While working, I had some credit card debt, which I was paying on. Once I lost my employment, I defaulted. My only income, now, is the SSDI, and it just barely covers absolute necessities. Even with that income, I get food stamps. Sometimes, I go without meds that I don't have the co-pays for. I barely keep food in the house. I can't afford to get new eyeglasses, which I need. So I've trimmed down as close to the bone as I know how to do.

I get calls from creditors, and I always give them a full explanation of my situation. They are pretty reasonable to talk to, and I try to be the same. I have no assets. My only hope of repaying is, if I could go back to working. That might not happen for a while . . . if ever. I might never have more than my SSDI.

One creditor told me that they were going to sue me. Today I got the summons about the lawsuit. I have no assets, and my only income is SSDI. I don't know what they think they are going to get. There is nothing for them to take. Since I'm a senior, it's not real likely that that will change.

The creditor is a bank that had issued me a credit card. What I owe on it is not a vast amount of money. When I lost my job, I stopped using any consumer credit. I had credit still available, but I did not want to incur any more debt, once I knew I had no income. So I was not guilty of any fraudulent use of credit. That's why I am kind of puzzled that they are coming after me. It seems kind of pointless to me.

I suppose I could have filed bankcruptcy. I suppose I still can.

I'm wondering what to do about this creditor. I have told them that, right now, I cannot afford to pay them even $5.00 per month. That is the absolute truth. I have nothing that any judge can take from me to give them. I wonder why they are doing this. I have a few creditors, and only one is doing this.

If anyone wants to post some feedback, or PM me, I'll be glad of any thoughts anyone has.

Thank you.

[Yoda]

That stinks. I defaulted on some loans. Two I owed less than $100 but this was at a time several years back when I was financially irresponsible and could have made small payments but didn't. I owe several thousand in medical bills and I pay $25/month but I totally understand you not having any extra $$ to pay toward what you owe. I defaulted on a ~$8000 loan and when the collections called I told them I was no longer employed and if I found employment I would start making payments. They seemed fine with that. Which is true, I am finally well enough to work part time, I think.

But a summons? Wow, that sounds scary. That never happened to me. All you can do is say you were working but at this time you are unable to work and hope for the best.

Maybe someone has better idea than me. Sorry this is happening to you.

[Rose76]

Thanks so much, Yoda. You've been in similar situation. I, too, have both consumer and medical debt. I was keeping up with it. Then, I became unemployable and just couldn't. It happened rather suddenly, and it was unexpected.

Like you, I've told my creditors that I have nothing at the moment, but will try to work something out, if I regain employment. There are several creditors, and they seemed to be accepting the reality of where I'm at. Only one creditor is coming after me . . . for an amount of about $2000.

I really got very despondent about this earlier (just got the summons, this eve.) Now I'm lightening up. They can't get blood out of stone. People all over this country have had to walk away from debt . . . mortgages, credit card, you name it. It happens, and our laws are set up to let it happen. We don't have "debtor prisons" in this country. Unsecured debt, like this particular credit card debt, is a chance that the bank takes . . . for a high rate of return. They took a chance and they lost. Just like I had some investments that went bad in 2008.

When they've called me recently, they've said things like, "Are you willing to try and resolve this voluntarily?" implying that they have some other option . . . to make me pay up, involuntarily. I know this is a scare tactic they use, but I still talked respectfully to them.

I feel like calling them up and saying, "Go ahead! Sue your little hearts out! I'm sick . . . I'm broke . . . I've got nothing. You made me a loan that's gone bad. Suck it up." This is a big deal bank. They should have better things to do . . . more fruitful ways to apply effort.

I've got to give the medical people credit. I have thousands in medical debt. They've just decided to leave me alone.

[Perna]

Oh, Rose, I'm sorry you have that added stress right now. I think collection agencies get their money from the percentage of what they collect and so they have to at least try; I also believe they only do that for a year before they "give up".

The suing part; my husband's company sued someone who did not pay for a huge amount of money and won the suit but my husband explained to me that it is pretty meaningless as the "court" does not have any way to collect (the Supreme Court does not have an "Army" so can't literally enforce its laws; Congress or the Pres, etc. has to do that) so all one is left with is a piece of paper saying you are owed. As you say, it's not like they can throw you in debtor's prison anymore? I guess they are just trying to unsettle/scare you so you do give that $5 a month you can't afford.

I would maybe see if your area has a legal aid sort of lawyer/school and ask them if you should do anything.

Personally, my stepson was in prison for awhile and creditors can't collect from them either. He got "ready" before he went in and he and his brother arranged his affairs, etc. We got 2-3 calls but, since he's very grown/never lived with us we just said, "we don't have one of those"/wrong number :-)

[splitimage]

Oh Rose,

I'm sorry - creditor calls are so unsettling. I'd get credit advice, there's often free credit counseling advice available.

I declared bankruptcy last year - I was in a similar space, no job for 2 years, a lot of debt, minimal assets, and very low income from what I could withdraw from my retirement account, which was protected from creditors.

Bankruptcy isn't for everyone and I know laws vary from place to place, but it was a good decision for me. It got the creditors off my back, and since my income was so low, I didn't have to repay any debt. Yes it messed up my credit rating, but once I get a job again, I'll work on rebuilding it.

splitimage

[eskielover]

They just do the law suit thing to try & intimidate you into paying....the fact is that your disability money is judgment proof.....& if you have nothing else in the way of assets......they you have nothing to worry about....I have gone through this since in the late 1990's.......I lost my engineering career & my H took over the finances.....& he is a moron when it comes to money....always believed that if he could pay the minimum payment that it was OK.....so besides the fact that he didn't believe that I wasn't going to go back to work.......& all the medical bills & accrued......several of the debt companies put a lein on the house that's still sitting there.....all the rest went to collection & after all these years they have basically vanished........

I left my H 6 years ago......sadly, the bad marriage was part of my serious problems that kept the hospital expenses coming.....since I left I have seen exactly how he handles debt....including the IRS, property taxes, & the house payment until the house ended up in foreclosure. Because I didn't divorce him after leaving, he has completely destroyed any possible credit rating I could have....but that's probably a very good thing....I just didn't realize until now that even our home owner's insurance & auto insurance amount is dependent on how bad your credit rating is.....so my costs are higher because of his irresponsible financial ways.

Disability isn't judgment proof to the IRS......but to all other debt it is.....so you have nothing to worry about....only problem is the stress that one ends up going through because of all of this.....but if you go to the hearing & take your financial statement........the judge will see the truth of the situation.

Bankruptcy might be a good way for you to clean the slate.

I'm sorry that you are having to go through all this
Based on what you wrote, the creditors shouldn't be able to prove any fault on your side form becoming unable to pay the bills. They are trying to intimidate you but in the end it doesn't seem likely that they will win before court. I have been in a similar situation and had debt collectors sending me warnings after warnings. They stopped for now..I haven't heard from them in a few months. I wrote them that I had chronic medical problems, no income and no assets and I asked them to give me a suggestion as to how to give them their money
You might have already done that but you might want to check what the statute of limitations for your debts is in your State. Maybe it has already passed
Maybe you could contact a consumer debt lawyer. There are some who offer their services on a pro bono basis or at least the first appointment is offered for free. Here is the site of the National Association of Consumer Advocates : National Association of Consumer Advocates | Consumer Protection Advocates and Attorneys - Help for Consumers.
I hope things get better soon. Hang in there

[Yoda]

An important point about the statute of limitations: say for instance that in your state it is seven years. If you have defaulted and make a payment toward that debt, no matter how small the payment is, $5 even, they reset the clock from that time and the statue then begins from the time of the last payment.

[shezbut]

(((Rose)))

I know that it's very distressing. I was in a very similar position when my disability kicked in. Social Security was a few months late, so I got a little chunk of money to begin with. I felt so bad, I sent it all to my creditors, instead of putting any into household goods that I needed to get for my apartment. Stupid! But, that's how bad I felt & so pressured by their tactics to get me to pay medical bills and a Visa card (up from buying food, meds, etc.).

One company were real jerks to me. Very angry-sounding and not real sympathetic towards my medical condition. I actually cried and worried that I was a terribly person for not having the money to pay the bills in full. It took awhile for realism to snap in, and for me to realize that I couldn't possibly do any more than I was already.

My ex-hub and I were still married, but we'd separated about 1 yr prior. So, we went and got a bankruptcy before our divorce went in to court (that way neither of us could be come after for money after the divorce). That worked for us.

I'm certainly NOT proud ~ I hated taking that step! But, I certainly had no way that I could possibly pay the money either. So, I slowly accepted it and let go of the shame associated with the act in my mind.

It is a tough part of disability, and takes a little while to get used to. Try local food co-ops in your area as well, in case you haven't already. Another tip: it was very, very hard for me ~ but I finally accepted no longer driving as well. {That came up due to my epilepsy, and I wasn't allowed to drive for 3 months, then 3 more, and yet again.} The cost of gas, maintenance, and insurance adds up to more than $200/month. That's a big chunk of my monthly check!

So, I decided to just keep up with monthly bus passes (free from my county social worker), keep up with my regular walks, and I'm okay. Something for you to think about anyway. (((((gentle hugs sent your way)))) Take care!

[Rose76]

I am so grateful for the replies you all have posted. Perna, thanks for the reassurance about the lawsuit only producing a "piece of paper." I didn't think they could take my SSDI, but I still was nervous. Splitimage, I will have to look into credit counseling and bankruptcy. I didn't think it was necessary, since I have no assets to protect. But I do have to protect my sanity. Eskielover, sorry for what you've gone through. Thanks for mentioning about "judgement proof." I looked that up, and was reassured that my SSDI should be safe. Chocmouse, thanks for mentioning about "statute of limitation." I looked that up, too, and it's good to know about. In my case, it's a few years off. Yes, Yoda, I see where, if I send them any money (which I don't have) it pushes back that date. Thanks, Shez, it is a big adjustment, but it has to be made.

This summons and pending lawsuit got be so upset yesterday. I guess that's what it is designed to do. I can opt to just do nothing about it. But I might file an "Answer" to the summons and go to court to see what happens. I wonder if bankruptcy can get rid of this debt after the court issues a judgement.

Thank you all for taking the time to respond. I feel a bit better today. I'm sorry for all that you've all gone through. It does show me that these things can be got through. It's not the end of the world. Hugs to everyone.

[healingme4me]

I got a 'false summons' in the mail once! It's supposed to be hand delivered by an official, not just mailed. Just wanted to mention that, because, sometimes it's all a hoax to bully and coerce. If the creditor, is specifically the one you owe, it could be legit, otherwise, people in debt, beware of the scammers!!

These business buy and sell old debts, like it's nothing. Hope all goes well. Personally, I know of no one, that has ever gone to court, over a 'credit debt'. Not to say, it doesn't happen, but ....

[healingme4me]

Just to note, ^^ if it is a hoax, they are asking for you to submit financial's as example to settle debts, which then puts you right back on the credit clock and it's also their 'proof' of you acknowledging that you owe 'them' money, not just the original creditor.

[Rose76]

It does seem to be legit. This is a law firm that says it is representing Barclays Bank, the original issuer of the credit card. (Juniper financial.)

I talked to the clerk at the court. She told me that the court has a packet I can fill out. Also, the court has paralegals who will help me fill out the paperwork.

From what I've read, I could just ignore it. Still, I might go to the court and fill out the paperwork.

I also looked up the law firm. Apparently, this law firm specializes in helping out creditors to go after unpaid debt. So I am guessing that they do know what they are doing. My income is "exempt" and can't be touched by them. I guess they go after a bunch of debtors at a time, figuring that out of the bunch will be some with assets and/or income that they can go after.

Most creditors don't do this. I guess people should beware of Barclays Bank. I read about others on-line who complained about Juniper Financial (Barclays Bank.) This bank has a history of being investigated for shady dealings. But it is big and powerful. It bought out Lehman Brothers back in 2008.

[Nobodyandnothing]

Rose,
Just a quick warning. If the creditor gets a judgment against you and you have any kind of tax refund coming next year (even some people on SSDI sometimes are eligible for income tax credits), once the refund is deposited by the IRS in your bank account, the creditor with the judgment may be able to seize it.

[Rose76]

Hi, nobody. Thank you so much for this warning. It is very relevant. I expect I will get a tax refund, at least from the state I live in. I need that money for basic necessities. It will be given to me based on me being very low income. I want to do all I can to protect it.

I am leaning toward answering the summons, not to contest the validity of the debt, but to force the court to have a hearing and not do a default judgement against me. I wish I knew if that will make the ultimate outcome any different.

I do owe this money. But I am in dire financial straights. I truly can not afford to lose anything I may get. I mean, if other people can hold on to homes that they own, I am sad to think I might lose the few dollars I get back from my tax return. That seems so unfair. I wonder if I can appeal to the judge to render the judgement in a way that constrains execution so as no to impose real hardship on me.

There is something in the summons about mandatory arbitration. There is so much I don't know about this whole process.

Thanks very much for this warning.

I want to thank everyone again for giving me very relevant and practical feedback. I have no spouse or children. I deal with these things all alone. Thank you for helping me feel less alone. Last night I just cried. Today I am not so bad.

[Fresia]

It may be hard to find but there are free legal aide organizations in most areas; please talk to an attorney/lawyer about this. As mentioned above, it may be a scare tactic or it may be legit, but you need to know what your legitimate options are given the circumstances and only a legal representative can do that. Please seek counsel asap to know what your options are and how to handle the situation in your best interest. It is worth doing and can make a world of difference. I know how hard this all can be dealing with it and meanwhile, will be hoping it all works out and for the best. Hang in there! (((((Rose)))))

[AAAAA]

Rose do not ignore the summons! They want you to do that so that they can get a default judgment against you. Fill out the paperwork and appear. State your case. The judge will decide if you can pay any or all of the debt. As someone mentioned, if you do not appear and face the issue head on any tax refund etc. can be taken and applied against the judgment against you.

You may think this is frivolous of the bank, but if they took everyone at their word, they would never recoup any money.

[shortandcute]

The summons thing is a scare tactic; I've had a creditor pull that on me once--that was over two years ago, and they never did sue. If you are only getting government checks, they cannot due anything. Even if they did try to sue you, you would not be forced to pay, and they can't garnish government checks! Bankruptcy can cost you a lot of money.

[anneo59]

Have been thru this, too, and it was very difficult, but we managed. May yet be going thru it again if hub can't hold it together and leaves us and also with his company dropping insurance coverage on me and my son! Rough!!!!

[Perna]

mlm1616, make sure you find a non-profit programme if you are interested in trying it, not one that is out to make money. There are a lot of people that will trap you into owing them more money at a huge interest rate just to "consolidate" your debt and other relatively useless "help" methods.

[Rose76]

Thanks Perna. I am thinking of asking the local legal aid office to recommend a safe source of debt counseling.

[Rose76]

I'be been sick and am just recently recovered from a serious intestinal infection that had me in the ER twice in one week. So I neglected this whole issue, and the deadline for me answering the summons is passed. It was like 20 or 30 days that I had to respond.

Had I done that, as I should have, I would have been notified of the progress of the case. So I got to thinking that it was too late to do anything. Now, I'm not so sure. I hope to go down to the clerk of the court (which I should have already done) and ask what happens next. I know that my failure to respond can let the bank win by default. Then, again, since it is a legitimate debt, I figured that they would win a judgement against me, regardless of what I did.

I know that was me getting into a "defeatist" mentality. But I imagine that I might have some access to at least know what is proceeding, so that I don't only find out when something disappears from my checking account.

I am grateful for the posts here. I need to find the motivation to do the things recommended - like go to legal aid, go to the clerk of the district court, and go to my bank and ask them what exactly happens when they are notified about a lien against a customer's account. I just was sick and tired and depressed and have not been serving my own interests very well.

[Open Eyes]

Can you get a not from your doctor explaining that you "were really ill" and that is why you didn't respond?

Try that Rose, as you also went to the ER twice.

[eskielover]

In reality....a debt is a debt that we owe....no contesting that....the thing is that...disability income is judgment proof.....if you own a house, they can put a lein on that.....if you are working (which you aren't) they can put a judgment against wages.....but basically, all they end up doing is getting the judgment saying they are entitled to the money (like no duh)....& they can't do a thing about it so all they can do is set on it.....make yourself unavailable to their harassing calls......& basically there is nothing they can do to collect the money or force you to pay money you don't have.

Some medical bills I have had here when I fractured my back....I paid them $5/month....it took forever but if they wanted the money that bad, they had to deal with it....some wrote off the amount...others didn't when it came to medical bills.....one stupidly sent the bill to collection when I had been paying on it & I got all over their case....never got another bill from them after they straightened that out.

It's a horrible feeling being in this position.....but I'm beginning to realize that so many of us are in that position with the economy the way it is....& the lending companies are just going to eat it......feel it's sort of their responsibility for selling the concept of credit to everyone....this is the price they pay....but they never thought it would come to this.

[Rose76]

Hi eskielover. I think that is the way I am going to look at it. I appreciate your input. It sounds like you've been through this and can really understand.