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Need guidance on disability income and cc debt

The last post in this topic was posted 4379 days ago. 

 

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Trying to help a friend figure things out. She is on disability, owns a house with her husband, and owes a ton of credit card debt (about $70,000). They have a fair amount of equity in their house, so she doesn't think BK is an option since they have home equity.

 

If her accounts go to collections, what can happen to their joint property? Her disability income doesn't even pay the minimum payments on her accounts and her husband's income has been slashed dramatically and they're trying to maintain his credit record since he's the breadwinner. Does she need to open up a new checking account for her disability to be deposited into in order to avoid their accounts being frozen? How will this affect her husband? They are up to date on the mortgage and everything else as of today, but that's going to change by the first of next month. They'll have the money to keep current on their mortgage and (hopefully) his debts, but not her debts (they don't have joint credit cards).

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Is it her debt in her name only? Her creditors may put a lien on her house. But I can tell you for sure they cannot attach her disability payments.

 

What I would do is get her own checking account in her name for her monthly checks. It will not stop them from getting frozen if she got a judgement, but all she will have to do and prove the income is all SSD.

 

One thing also she could just trying to pay the smaller amounts cc debt. I was in the same boat, I waited 4 years for my ssd, although I let a lot of my cc go, I held on to two of them.

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Does your friend live in a community property state? Garnishment laws vary from state to state, but it is uniform that Social Security disability income is safe from attachment. However, private disability insurance payments may be a different story.

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The last post in this topic was posted 4379 days ago. 

 

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