credit card threats to sue/judgement

[ddub]

my widowed mother, 70 years old has made bad choices with her finances since her husband passed. its been 8 years, she has mortgaged the house to the max, maxxed out all credit cards, spent her savings, all but maybe $4500 worth.

problem: chase bank credit card sent a letter saying they will sue her and put a judgement against her if she dont respond within 10 days. $8000 credit card. she refuses to file for bankruptcy, she's old school and wants to pay her debt. she also wants to give me her house when she passes. whats the best thing to do, let them sue and put a judgement lien on the house or file bankruptcy?

there will be other debts coming soon i could only imagine.

dw

 

[army judge]

What is mom's state of residence?
Does mom have any income other than pension, social security, or disability?

 

[ddub]

texas, no just social security, a small retirement

 

[army judge]

texas, no just social security, a small retirement

Your mother is right.
Heck, haven't you learned by now, mom's always right! :yes:
In Texas, your mother's pension can not be levied against.
Her home can't be levied, however, a lien can be attached to the deed.
That lien can't be used to force the home's sale to satisfy the judgment.

Well, you ask, what good is it?
No good, nothing at the moment.
It also has to be renewed periodically to keep it effective.
It also costs the creditor money to get that lien.
It costs them more money to attach it to the deed.

It sits there, hoping that one day you sell your home and the lien holder gets paid first.
So, say someone sues mom for $5,000.
They win.
They get their judgment.
They attach it to the deed.
How isn't important, just accept the fact they do it.
Time passes, and mom sells her home.
Before mom gets paid, the lien holder gets its five grand.

But, let's say mom unfortunately takes ill and succumbs to her illness.
You inherit the home.
The lien still suits there, waiting for the home to be sold.
You love the home, and don't sell it.
The lien holder never takes a dime.
The lien holder only gets paid, if the home is sold.

So, stop worrying.
Be happy and always listen to mom.
Mom has nothing to fear.
Texas is a very friendly state to debtors.
Heck, not only can't a person's disability check, pension, welfare can't be levied against; neither can someone else's paycheck!
God bless your mom.

 

[ddub]

thanks again!
so are you saying if the house is willed to me, i wouldn't have to pay off the judgements to put it in my name? just if i sold it instead of making it a rent house.

 

[army judge]

thanks again!
so are you saying if the house is willed to me, i wouldn't have to pay off the judgements to put it in my name? just if i sold it instead of making it a rent house.

Yes, only when its sold.
If you inherit, you inherit the lien.
If you sell it, the lien-holder gets paid first, out of your funds from the sale.
But, mom's not going anywhere soon.
Screw the house, worry about mom.

I lost my mom several years ago.
I miss her every day.
Enjoy your mom, let her do things the way she wants to do them.

Nothing should be too good for mom.
She gave you life.
Dad helped, but mom did all the work for nine, long months.
God bless your mother!

 

[Darsha05]

Well said Army judge...and all that you advise...what are the chances of Chase actually going through the motions and placing the lien??? Although I've seen it done for less money when not responded too.

Wouldn't it be wise to dispute the 10 day...have mom put the home in the daughters name during life and become judgment proof?

wishing you and your mom the best of everything!

 

[ddub]

But, mom's not going anywhere soon.
Screw the house, worry about mom.

I lost my mom several years ago.
I miss her every day.
Enjoy your mom, let her do things the way she wants to do them.

Nothing should be too good for mom.
She gave you life.
Dad helped, but mom did all the work for nine, long months.
God bless your mother!

ACTUALLY, dad died when i was two, mom raised both of us by herself and for 10 years did a fine job all by herself. thank you.

 

[ddub]

Wouldn't it be wise to dispute the 10 day...have mom put the home in the daughters name during life and become judgment proof?

thank you, but if there is debt against the house, she refinanced at a high rate, would i have to "purchase" the house myself from the lein holder to remove her from the house, so to speak, so its judgement proof?

 

[Darsha05]

Eeek...This is where the experts on this site come in...I am curious of the answer myself...sorry I can't be of help...I wanted to throw that out there to see if there were other options for you and mom.

I suspect that you are correct in your inquiry ? - chances are yes, you would. And you certainly wouldn't do that. Thankfully they cannot attach her pension or SS, but because the house, even double mortgaged remains as asset, it is open to any creditor to place a lien. In my experience, I would most definitely respond to the 10 day notice with the Prothonotary and continue to respond until they figure out that it just isn't worth their time since they couldn't automatically get a default judgment. It's a fairly simple process and most local court houses have the form online. Fill it out and mail within the 10 days...have it clocked and recorded at the courthouse. Chase will receive a copy of your notice and the ball will be back in their court. Either way, it's like chasing your tail...to some it makes more sense than allowing them to get a default judgment because you didn't respond. In my state it doesn't cost anything to send a response other than the cost of the the return postage envelope to chase...providing you hand deliver and do not need the clocked copy mailed to you as well.

 

[army judge]

thank you, but if there is debt against the house, she refinanced at a high rate, would i have to "purchase" the house myself from the lein holder to remove her from the house, so to speak, so its judgement proof?

Homes are judgment proof in Texas.
Our state constitution provides for that.
It isn't any safer in your name, than it is in mom's.

Actually, it's safer in the names of seniors, disabled vets, handicaps, and widows.

Homes can't be foreclosed on for debts. Only the mortgage owner can foreclose on a Texas home, and in some cases the government.

 

[Darsha05]

Likewise...it sounds like you should leave well enough alone as Army stated, but I would encourage you to respond to any letters or correspondence from Chase solely through your responses to the court house. Do not acknowledge the debt to Chase and continue the course through responses of denial/dispute. Anything other than that will only add to the Statute of Limitations till they can't bother you anymore - or at least place judgment against the home. In my state it is 5 yrs...but it varies. From what Army describes, TX is forgiving so it may be less. Default on payment begins after the first contact from the creditor that you are late. Go from there...