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Do you have to file bankruptcy if there is judgment against

 
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  • Answered by:cfortunato
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Customer Question

Do you have to file bankruptcy if there is judgment against you and you have no property, etc,. Can my elderly parents go indefinitely with a judgment and not have to file bankrupcy??

 

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State/Country relating to question: Nebraska

Submitted: 340 days and 6 hours ago.
Category: Bankruptcy Law
Value: $30
Status: CLOSED
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Expert:  cfortunato replied340 days and 6 hours ago.

Hi - my name is XXXXX XXXXX X'm a Bankruptcy attorney here to assist you.

1) Do your parents have a bank account?
2) What is the source of your parents' income (social security, pension, etc.)?
3) Do your parents live in Nebraska?

Customer replied340 days and 6 hours ago.

my parents have a bank account, social security and a small pension. They do live in NE

Accepted Answer

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Expert:  cfortunato replied340 days and 6 hours ago.

If your parents do not own any assets, and their income is from social security and a pension only, then they are considered to be "judgment proof" - which means there is nothing a judgment holder can do to them - whether or not they file a Bankruptcy.

So, given the information you provided, your parents do not have to file a Bankrutpcy.

Additionally, if all the money in their bank account is from Social Security and their pension, a judgment holder cannot garnish that bank account. However, if there is any money in that account that is not from Social Security or their pension, that account can be garnished, so it is usually a good idea to open a new account into which only Social Security and pension funds are deposited.
Also, if all the money is from Social Security or their pension, they should inform the bank - in person and in writing so they have proof - that the bank should never allow their account to be garnished because all the money is from Social Security and their pension. If they don't notify the bank, the bank will not know all the money is from Social Security and their pension(even if it is direct-deposited), and their account can then be garnished.

Expert TypeAttorney
Category: Bankruptcy Law
Pos. Feedback: 99.6 %
Accepts: 3030
Answered: 6/17/2012

Experience: Bankruptcy professor.

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