I have some major problems with debt. Right now I have a lawyer saying they are going to take us to court.
What will happens next?
Is my house at risk?
What should I do?
Court Action
Posted on Wednesday, February 13, 2008
posted by Questions @ 3:52 pm
1 Expert Comment:
At February 14, 2008 |
9:46 am
, Barton Goth GCO Bankruptcy Trustees Said...
Once a creditor has been unsuccessful collecting an outstanding debt going to court is the next normal action. When one of your creditors starts to proceed with court action all this means is they are going to set a court hearing in an attempt to obtain a judgment. If the creditor is successful at obtaining a judgemnt, and they usually are, they have a variety of options.
The first and most common thing is garnishment. A creditor with a judgment can apply for a garnishee and ultimately seize funds off your pay cheque or alternatively out of your bank account. The second thing they can do, although less common, is they can move against personal poperty. Now this doens`t mena they can seize everything you own. They are limited by the same exemptions you find in a bankruptcy. So with a house they can’t move against the house unless you have greater than $40,000 equity in the property (assuming it qualifies as your principle residence).
Once your creditors start to proceed with court activity it is important that you meet with a local trustee. There are a variety of ways to stop this legal activity and potentially protect your non-exempt property but the key is you have to be pro-active, the longer you wait the fewer options you will have.
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