Dear Liz: I am 72 and have some credit card debt I can’t pay. I live on Social Security and a small pension and am still paying a mortgage on a house I own in another state. (I’m currently renting.) I’ve been trying to sell the house for quite some time with no success. Can my creditors take my income or my house?
Answer: Creditors other than the federal government are not allowed to garnish your Social Security benefits. Many pensions are exempt as well.
Your equity in your home, however, may be fair game. States have “homestead exemptions” that protect a certain amount of equity in a primary residence, with the amount varying by the state. But creditors may be able to go after equity above those amounts, or any equity in a property that’s not your primary residence.
You need to find an experienced bankruptcy attorney familiar with the laws of both states to give you advice. You can get referrals from the National Assn. of Consumer Bankruptcy Attorneys at http://www.nacba.org.