Can A Debt Collector Take My Social Security Or Va Benefits?

[pacmanx1]

I posted this in another post but feel that more eyes need to read it.

Bank accounts and services

Can a debt collector take my Social Security or VA benefits?

updated 6/16/2015

No. Most debt collectors can’t take your Social Security or VA benefits directly out of your bank account.

When a collector sues you for the debt and wins a judgment, it can ask your bank or credit union to turn over money from your account. This is called a garnishment. Banks must automatically protect Social Security and VA benefits from garnishment if they are direct deposited into your account. (There are some exceptions to this rule, which are explained below.) Here’s how the automatic protection works.

Your bank protects 2 months’ worth of benefits

If a collector tries to garnish money in your account, your bank must look at your account history to see if you received any Social Security or VA benefits by direct deposit in the last 2 months. The bank must protect 2 months’ worth of benefits from garnishment and let you use that money. If your account has more than 2 months’ worth of benefits, your bank can freeze the extra money.

Example

If you receive $1,000 in Social Security each month, your bank will see that $2,000 in Social Security was direct deposited in the last 2 months. The bank must allow you to use up to $2,000 in the account.

If you receive $1,000 in Social Security benefits by direct deposit each month, and you have $3,000 in your account, the bank can freeze $1,000 of the $3,000. The bank must give you access to the remaining $2,000 so you can continue to pay bills and withdraw cash as usual.

If the bank freezes your money

If your bank freezes any money in your account, it must send you a notice of garnishment. Then, a judge decides whether your money should be turned over to the debt collector based on factors such as the source of your income and state law.

It is very important for the judge to know that your money comes from Social Security or VA benefits before the judge decides whether your money should be turned over to the debt collector. You can seek help from a lawyer. If you can’t afford a lawyer, you may be eligible for free legal help.

Benefits on a prepaid card

Many people receive Social Security or VA benefits on a prepaid card. If your benefits are loaded onto a Direct Express card or to another prepaid account, they are still automatically protected from garnishment just like money in a bank account.

Exceptions

Social Security and Social Security Disability Insurance (SSDI) can be garnished to pay government debts such as back taxes or federal student loans, and debts for child or spousal support. Some other benefits, such as Supplemental Security Income (SSI), are protected from garnishment – even to pay a government debt or child or spousal support.

Automatic protections don’t apply to paper checks.

If you receive Social Security or VA benefits by check and then deposit the check into your bank account, the bank does not have to protect 2 months’ worth of benefits in the account automatically. This means that your entire account balance could be frozen and you’ll need to go to court to prove that it comes from protected federal benefits and should not be garnished.

You can protect your benefits by having them direct deposited to a bank account or loaded onto a prepaid card.

To take advantage of the automatic protections for direct deposited Social Security and VA benefits, you can sign up to have these benefits direct deposited to your bank account or loaded onto a prepaid card.

Consider finding legal help in your state:
You may qualify for free legal help.

• The Center for Elder Rights Advocacy can refer you to a local agency that provides free legal help to seniors who qualify. You can call the Center for Elder Rights Advocacy at: (866) 949-2372 or visit: Legalhotlines.org.
• You can also find your local legal services program or attorney referral program here.

Tips:

1. You can use our sample letter to tell a collector that your Social Security or VA benefits are protected from garnishment. Check out the sample letter here.
2. Consider talking with a lawyer in your state about other state and federal laws that may help protect your money and other assets from garnishment.

Federal and state laws may protect the money you receive from other sources from garnishment. This may include money you receive from a pension or retirement plan, federal student loans, child support or spousal support payments. Other laws in your state may protect some of your money and assets, too. To learn more about how they may be protected, consider finding legal help.

3. Know when your bank can and can’t charge you fees for garnishment. Your bank can only charge you a fee for processing the garnishment if you have more than 2 months’ worth of direct deposited Social Security or VA benefits in your account. To learn more, click here.

http://www.consumerf...s-pay-debt.html

[Pete53]

Thank you and of course State Laws can offer additional protection.

[jbasser]

First and foremost I have seen this in real time. Your comp and SSA or SSDI benefits are protected from all creditors unless the creditor is a State of federal government/ This 2 month rule is not accurate as they are in violation of federal law if they do hold an account.

(1) Payments of benefits due or to become

due under any law administered by the Secretary

shall not be assignable except to the extent

specifically authorized by law, and such

payments made to, or on account of, a beneficiary

shall be exempt from taxation, shall be

exempt from the claim of creditors, and shall

not be liable to attachment, levy, or seizure by

or under any legal or equitable process whatever,

either before or after receipt by the beneficiary.

The preceding sentence shall not apply

to claims of the United States arising under

such laws nor shall the exemption therein contained

as to taxation extend to any property

purchased in part or wholly out of such payments.

The provisions of this section shall not

be construed to prohibit the assignment of insurance

otherwise authorized under chapter 19 of

this title, or of servicemen’s indemnity.

[Buck52]

Talk about creditors,

We have an old Sears Account for a then old style projection 50 in TV, I can't remember how much it was but it kept going out and through out the warranty Sears was out on twice a year replacing the projection tube (which was expensive if we had to pay for it.

well after 3 years 36 months of payments around 39.00 monthly it went out again...so I called Sears and they said its out of warranty it would be costing approx. 600.00 $$ to repair it....

I blew a fuse and said well don't come out...I check with Sears Accounting office and ask how much we still owed on the TV I said it should not be that much we paid on it for ever three years now.

and the girl got back to me and said we still owed ###*** it was more than when we first purchase the dad-gum thing...I called Sears back to come pick it up I was not paying another dime on it...they came pick up the TV

Now this has been over 20/25 plus years AGO and we still get calls from collection agency Dunn us.

As the collections agency's buy the account & get tired with no results and Re-sale the account to other collections agency's and the calls just keep coming...even with an unlisted No.

..................Buck

[broncovet]

I have a method of getting rid of unwanted calls.

First, they call and ask if "Joe Veteran" is there. I never answer, but ask a question instead, "Who is calling".

They give me their name and I ask "who are you with"?.

They tell me who they are with, and I ask them another question, "Whats this about?"

You see, I take control over the conversation by asking the questions and I do not answer theirs, but ask them another question.

After I find out what its about, I say, "im not intersted".

A few times they call me back and say, "Im not a salesman".

That's okay, they all say that, Im not interested dont call back here ever again, "send it to me in the mail" and hang up.

If they do call back, I ask to speak to the supervisor. Then I ask the supervisor why they keep violating federal law, when "harassment" is illegal. They have to stop calling if you ask. Ive never had the method fail.

They can not sue you for a 20 year old debt. Statue of limitiations is probably 7 years in most states, in some its less.

They "think" im too dumb to "get" that they are a bill collector and not a salesman. Thats fine by me, as it often gets them from calling me again.

Edited August 1, 2015 by broncovet

[Guest]

http://www.fair-debt-collection.com/sol-by-state.html

Debts that are past the statute of limitations maybe uncollectible, unreportable or capable of simple resolution.

[Buck52]

Well I think what happens is after a debt collector buys the bad account and tries to collect with no luck, they sell the account to another debt collector at a reduced price, and the account is staying ''live'', and then that debt collector sells it to another debt collector and the thing just keeps repeating.

I have tried everything under the sun and still keep getting dept collection calls on that 25 /28 year old TV ITS PROBABLY AN ANTIQUE BY NOW WORTH A LOT OF MONEY eh!

.............Buck

Edited August 2, 2015 by Buck52