Can my parents seek bankruptcy protection, they have no income and have about $25,000 in credit card debt

Yes, is there anything they can take away from them or do to them - At this stage late 70's their credit rating doesn't matter? They have a reverse mortgage - no income. Only social security. We (the kids) want them to just stop paying cc. I don't think they have any choice - should they contact the cc companies?

They can call the CC companies and try to negotiate a reduction of the balance along with a lowering of interest rates. However, when it comes down to it, they really have nothing to lose and if they really don't have the money, then they can't pay the CCs.

The most the CC companies can do is sue them and maybe put a lien on the house. However, they have no right to force a sale of their home because CCs are unsecured in nature.

It sounds like your parents might be judgment-proof. In other words, if the creditors sought and received a judgment, they'd get it but would have nothing to collect from. They may be able to garnish what little earnings they have and they may be able to recover some of the money in the bank account, though.

Bankruptcy would certainly cut off both of those options and the money in the bank would like be protected as an exempt asset. You should consult a bankruptcy attorney in your area to discuss the viability of bankruptcy for your parents and to determine if the assets that they do own would be exempt.

Many older people get so frightened and stressed by the activities and threats of debt collectors that they benefit from bankrutcy, even if they are judgment proof.

It is possible that the local Legal Aid office can refer them to a bankrutpcy attorney who would do the bankruptcy for them at a reduced fee. While they may be judgment proof, it takes a thick skin to ignore the insulting, threatening and persistent calls by debt collectors.

While your parents may be "judgment proof"--they have nothing that really can be attached or garnished--the creditors can still call them repeatedly, send nasty letters, sue them, and require them to come to court to answer questions about their assets. Some people aren't bothered by this, but others would rather file for Chapter 7 to stop it.

Brett Weiss

the quickest and easiest and least expensive answer is bankruptcy. otherwise the credit card companies will call, harrass, eventually bring lawsuits and attach bank accounts. to prevent all of this, chapter 7 bankruptcy is the answer. also, after a few non-appearances in the court from the lawsuits could result in civil contempt. who needs the headaches? bankruptcy is designed to help people just like your parents.


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