Debt Collection and America’s Senior Population

For many seniors, debt collection calls can produce a lot of anxiety.  When we’re planning for older age, we assume that we’ll have enough savings to handle our regular bills and to take care of any unexpected medical payments.  In a number of cases, these expectations hold true, and it turns out that debt collection calls simply are part of a scam.  In short, some seniors don’t owe the money that debt collectors claim they owe.  At the same time, however, the drastic decline in the economy ended up costing many seniors their lifetime savings, and as a result they cannot make ends meet.
How should older adults handle problems with debt collection?  According to a recent post from the Consumer Financial Protection Bureau (CFPB), here are some important points to keep in mind if you’re helping an elderly parent or loved one to manage debt.
Always Investigate if You Don’t Recognize a Debt
If you’ve been contacted by a debt collector, it’s very important that you understand the precise details of the debt.  According to the CFPB, many older adults have reported that debt collectors “have inaccurate or inadequate information,” and about one-third of all elderly consumers who filed a complaint with the CFPB indicated that they “couldn’t identify the debt being collected.”  So what can you do to investigate?
Ask questions when a debt collector calls you.  What questions should you ask?  Find out the name, company, address, and phone number of the debt collector.  You should also ask for the debt collector’s professional license number.  When callers won’t give up this information, it’s possible that you’re dealing with a scammer.  And once you have the company’s name and contact information, you should also seek additional information in writing.  Send a physical letter to the company—it’s best if you do it within 30 days of being contacted—and request additional information about the debt that’s being collected.
If you don’t owe the debt or the amount is wrong, you should dispute it immediately in writing.  If it turns out that you do in fact owe the debt but simply don’t recognize it or remember it, you may have other options if you can’t afford to pay it.  Many older consumers file for personal bankruptcy to alleviate the burden of medical bills and other substantial debts.
Understand Your Rights When it Comes to Benefits and Garnishment
If you do owe a serious debt or debts and you’re aged 65 or older, you may be concerned about whether your benefit payments are safe from debt collectors.  It’s important for older consumers to understand that certain benefits aren’t up for grabs by debt collectors.  While under certain circumstances creditors can garnish the wages of a debtor, those debtors also have protection for most of their federal benefits, such as Social Security, Supplemental Security Income (SSI) benefits, and Veterans’ (VA) benefits.
Indeed, if these benefits come to you through direct deposit into your checking account, the CFPB emphasizes that “your bank or credit union is required automatically to protect up to two months of these benefits that are directly deposited into your account.  In most cases, benefits issued on a prepaid card are also protected.
However, some situations exist where these benefits aren’t protected.  For instance, there are exceptions when it comes to debts you might owe to a federal or state agency.  At the same time, these benefits may be exempt if you decide to file for consumer bankruptcy.  As such, it’s essential that you discuss your case with an experienced Chicago bankruptcy lawyer.  At the Emerson Law Firm, we’ve been acting as dedicated consumer advocates for years, and we can discuss your situation with you today.
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