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Hello:I live in Minnesota. I have received a “Notice of Hearing” for a credit card debt.1)I have $90K equity in my homestead and own no other real estate2)My only income is social security, I am 68 years old.3)I have a small IRA4)My automobile is worth about $14K but has a $6K loan against it.Is this all protected against a judgment? Or collection?Thank you
Optional Information: Country relating to Question: United States State (if USA): Minnesota Already Tried: Nothing
Hello,Thank you for using JA. The Minnesota homestead exemption is currently $300K in equity in a person's primary residence. So with only $090K in equity, it would be exempt from judgment creditors..Social security is exempt from garnishment under federal law..Retirement accounts like IRA, 401K, pensions, and railroad retirement are also exempt from garnishment under federal law..There is a $4200 exemption in MN for vehicles. If you owe $6K on it, that would bump it to $10,200 of the $14K value. So they could possibly force a sale of the vehicle to get at the additional $3800 in equity that is unprotected..
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Thanks.
Barrister
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What is the likelyhood of a vehicle forced sale? With that potential for the $3,800 equity is it best to pro-actively sell my vehicle. If so, should I do that before the hearing or will I have some time afterwards to get that done.
Thanks,
Depending on the amount of the judgment, that might not be enough for them to justify the expense of going after, especially if they had to force a sale and the vehicle didn't bring the 14K. If it brought 10 or 12K, it wouldn't likely be worth it after they incurred the legal costs of pursuing it and forcing a sale..So if I were a betting man, I would bet that they wouldn't bother with the car..
Experience: 13 yrs practice, Realtor, Landlord 24+ yrs
Thank you, XXXXX XXXXX been a great help. I have one last question.
Do I need to file anything at my County Court House to insure that my personal residence is protected. It is recorded as homestead property.
No, if it is already claimed as your homestead, then it automatically has the protection without you needing to do anything further. The protection is automatic by statute once a homestead is claimed..You are very welcome..