![]() ![]() We can review your case and determine whether the debtor is judgment-proof and, if so, what your best course of action may be. If you are a creditor who is owed money by a debtor, our Chicago creditors' rights attorneys can help you understand your options for collecting the debt. Contact Our Cook County Debt Collection Lawyers A creditor may pursue a legal judgment against a debtor, and while a judgment-proof debtor will not be required to pay debts, if their financial situation changes in the future, the creditor may then resume collection actions and seek to garnish their wages or collect debts through other means. In situations where a debtor is judgment-proof, creditors may still be able to move forward with the debt collection process, either by making payment plans or other arrangements with a debtor or by taking legal action. A debtor will be considered to be judgment-proof if they do not own any non-exempt assets. In Illinois, the bankruptcy exemptions include $15,000 of equity in a home (or $30,000 for a married couple), a motor vehicle worth up to $2,400, tools of a person's trade worth up to $1,500, tax-exempt retirement benefits, and other personal property valued at up to $4,000. Certain types of assets are exempt from liquidation if a debtor files for bankruptcy. If the income a debtor earns is below the level that will allow for wage garnishment, the assets they own may be considered. ![]() Also, only certain types of income are eligible for garnishment, and income earned through Social Security, unemployment benefits, other public benefits, or child support cannot be garnished. If a person earns a weekly after-tax income of $217.50 or less, none of their wages may be garnished. Federal law states that the maximum amount that can be garnished is 25 percent of a person's or the amount they earn that is above 30 times the federal minimum wage. Wage garnishment limits may be considered when determining whether a debtor has disposable income that may be used to pay debts. Generally, if a person does not earn enough to make payments toward their debts while also meeting their ongoing needs, and they do not have any non-exempt assets that may be seized and liquidated, they will be collection proof. The income a debtor earns and the assets they own will determine whether they are judgment-proof. Factors That Determine Whether a Debtor Is Judgment Proof ![]() By understanding the criteria that must be met for a debtor to be considered judgment proof, creditors can determine their best options for collecting debts. However, there may be some situations where a debtor may be judgment proof or collection proof, which will affect a creditor's ability to recover the amount owed. We have helped over 20,000 people rebuild their financial situation, and we are here to help you too.Creditors need to be able to collect debts that are owed to them, and there are a number of options available in situations where debtors fail to make payments as required. ![]() To help you start restoring your financial situation, our team at Wadhwani & Shanfeld is here to help you. Your financial situation could improve and then you will be required to take responsibility for the debt you owe. Seek Protection from CreditorsĮven if you are currently judgment proof, you shouldn’t ignore creditors since judgment proof isn’t often permanent. Creditors can even put lawsuits on hold and enforce them as soon as you have the income to pay off debts. Creditors can sue you and obtain a judgment against you to come after property or other assets to pay off the debt you owe. Unfortunately, yes – you can still be sued even if you are judgment proof.
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