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Category: Bankruptcy Law
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Experience:  Attorney in the practice of Bankruptcy Law since 1996
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I had a credit card in my name with Lowes. I added my ...

Customer Question

I had a credit card in my name with Lowes. I added my husband to the acct and he had his own card. (what a mistake that was!) He charged $990.00. He later filed Chapter 7 Bankruptcy. This debt was included. Lowes did not contest. The bankruptcy was discharged. The account shows on John's credit report as written off and therefore closed. Lowes has called me almost daily for the past 2 years! Now LVNV Funding LLC now owns the debt owed to Lowes. Today I received a request from Resurgent Capital Services asking me to resolve this debt by opening a credit card with a 19.9% interest rate. The payment will be $30 a month. They have added late charges so now the balance is $1101.49. They say they will forgive the $111.49 if I accept the offer to pay off the $990 with this Credit Card. Do I legally still owe this money? I'm on disability and cannot take on any more money bills. What do I do? I was not included in my husband's bankruptcy.
Submitted: 6 years ago.
Category: Bankruptcy Law
Expert:  JoeLawyer replied 6 years ago.

Hi Phyllis:

If you are on disability, have no garnishable source of income, and do not own real estate, then you may be "judgment proof," which means even if they sue you they still can never collect, so you may be able to ignore them. If you do have a job, then if they sue you they may be able to garnish you, so you will need to deal with them one way or another. Or, if your name is XXXXX XXXXX deed to real estate, if they sue you they will likely get a judgment lien on the real state, which again may force you to deal with the debt now, one way or another. But, if you cannot be garnished and have no real estate they can attach a judgment lien to, then the only issue you may face if they sue you is a hit on your credit score.

However, if you decide to deal with the debt now, it is rarely ever a good idea to incur new debt to try to pay off an old debt, and credit cards will usually take 40% or less to settle an old account, so their offer to reduce the balance by $111.49, which is basically agreeing to settle for 90%, and then charge you 19.9% interest, is not a very good offer based on many that I have seen.

Obviously I do not know all the facts and details of your situation, and even if I did I cannot give you advice online since I am not licensed to practice law in your state, but I can say that generally people who are judgment proof advise the collection agencies of this fact and then ignore them. After 6 years or so from the last charge or payment made on the account (depending on your state law) the debt expires based on the statute of limitations and becomes legally uncollectable. This does not mean they may not attempt to collect it after the statute of limitations expires, but if they do sue you and you respond to the lawsuit showing the court that no charges or payments toward the account have been made within the statute of limitations period for your state, the court would likely throw out their lawsuit anyway.

I hope this helps and a positive feedback is always appreciated if this was useful to you.

Joe

LEGAL NOTICE: I am only licensed to practice law in certain state(s) and I cannot give legal advice to someone who does not reside in a state in which I am licensed, nor shall anything I say in the above answer or elsewhere on this site be deemed legal advice, even to someone who resides in a state in which I am licensed. Fees I receive for answering questions are paid for information, not for legal advice. This forum is designed to provide general information only, and information herein is not warranted to be correct or applicable in any way since laws may have been misinterpreted herein, since laws change from time to time, and since the impact of those laws on any particular situation varies. The information presented in this site shall not be construed to be formal legal advice nor the formation of an attorney-client relationship. Persons accessing this response are encouraged to seek independent legal counsel in their jurisdiction for guidance regarding their individual circumstances. Do not take any action or inaction based on information presented herein since it is informational and may not be accurate or applicable to you; it merely attempts to give you a basis of knowledge to help you formulate questions to ask a legal or other professional in a face-to-face meeting in your jurisdiction. Joseph Ross does not hold himself out to be a specialist or expert in any area, regardless of assertions made by any third party, and any implication of being an expert or specialist herein is made in error. I hope the information presented above is useful to you. Answer above is (c) Joseph Ross. All rights reserved.

Customer: replied 6 years ago.
John and I are paying on a mortgage together but the house is not paid for. Will they put a lean against our home? Is the lien subject to the statue of limitations? Also, I am not supposed to incur new credit because I chose to settle my debts thru debt consolidation and am still paying on one card. Should I try to add them to the debt consolidation plan that I have or should I just ignore them? After this reply I will accept your answer and pay you because I really appreciate all the info you provided to me.
Expert:  JoeLawyer replied 6 years ago.

The fact that John is on the house may help. Many states protect a house from a lien if the house is owned by a husband and wife when the debt is only owed by one spouse (called "Tenancy by the Entireties" ownership, which is just a weird way to say "Owned by Husband and Wife").

Whether or not judgment liens are subject to a statute of limitations is a matter of state law. I know in some states the lien expires after 10 or 20 years, but this may vary widely from state to state. And, even if the lien expires, that doesn't mean a title company wouldn't still insist on the lien being taken care of to ensure they don't get stuck paying it if the house is ever transferred.

I can't really give you advice since I am not licensed to practice law in your state, so you will ultimately have to decide whether to add them to your consolidation plan. I think it may be insightful to ask the consolidation company if they think the card can be added. However, if the logic that you are judgment proof from collection by Lowes is accurate, then you should also being judgment proof from all the creditors in the debt consolidation, calling into question whether you continue to pay that as well.

The answer to these questions are state law-specific and highly dependent on the facts of your situation, so it may be helpful for you to at least consult with a bankruptcy attorney since they can review your situation and let you know if you should be paying on any of this stuff. Many bankruptcy attorneys offer free consultations, so it might be a good idea to do it and see.

Good luck!

LEGAL NOTICE: I am only licensed to practice law in certain state(s) and I cannot give legal advice to someone who does not reside in a state in which I am licensed, nor shall anything I say in the above answer or elsewhere on this site be deemed legal advice, even to someone who resides in a state in which I am licensed. Fees I receive for answering questions are paid for information, not for legal advice. This forum is designed to provide general information only, and information herein is not warranted to be correct or applicable in any way since laws may have been misinterpreted herein, since laws change from time to time, and since the impact of those laws on any particular situation varies. The information presented in this site shall not be construed to be formal legal advice nor the formation of an attorney-client relationship. Persons accessing this response are encouraged to seek independent legal counsel in their jurisdiction for guidance regarding their individual circumstances. Do not take any action or inaction based on information presented herein since it is informational and may not be accurate or applicable to you; it merely attempts to give you a basis of knowledge to help you formulate questions to ask a legal or other professional in a face-to-face meeting in your jurisdiction. Joseph Ross does not hold himself out to be a specialist or expert in any area, regardless of assertions made by any third party, and any implication of being an expert or specialist herein is made in error. I hope the information presented above is useful to you. Answer above is (c) Joseph Ross. All rights reserved.

JoeLawyer, Attorney
Category: Bankruptcy Law
Satisfied Customers: 767
Experience: Attorney in the practice of Bankruptcy Law since 1996
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