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Are Senior Citizens Judgment Proof?

Sometimes a person who is sued and receives court papers are told not to worry because he or she is “judgment proof.” What exactly does that word mean?


When someone owes money, for example a past due credit card or medical bill, the person or company to whom the money is owed can file a lawsuit in a court.  A lawsuit consists of what is called a “complaint,” a paper that alleges what money is owed for and how much is owed.  Also, there is normally a document attached to the complaint, called a “summons,” which explains that the person being sued (the “defendant”) has a certain amount of time to file an “answer” in court if they contest the complaint.  If an answer is not filed, the summons explains that the person filing the lawsuit, called the “plaintiff,” will obtain a judgment.  If answer is filed, eventually a trial would be held to determine if the money is owed.  If the plaintiff prevails, then he receives a judgment against the defendant.

Many persons who are sued have no defenses to the complaint or lawsuit filed against them because they do owe the money. Nevertheless, being sued can be frightening. Seniors worry someone could take their money, income, or property to pay the debt for which they’re being sued.  It is natural for people to ask questions about would could happen as a result of the lawsuit.  Sometimes, when senior citizens ask these questions, they are told not to worry, because they are "judgment proof."


A senior is judgment proof when a creditor with a judgment against him cannot get any of the senior's property through enforcement of the judgment.


 The majority of seniors are judgment proof.  A judgment allows the creditor to file what is called a “garnishment,” which orders someone who is holding money for you to pay them, not you.  If your only income is social security, a pension, disability income or a VA benefit, that income cannot be garnished because it is protected by federal law.  It can’t be taken from you.  Even net wages of $217.50 per week are protected from garnishment by federal law.  Furthermore, in Pennsylvania, North Carolina, South Carolina and Texas, garnishment of wages is not permitted by law.

money in a bank account

Federal regulations instruct banks and credit unions that twice the amount of monthly social security electronically deposited into a bank account is automatically protected from garnishment.  These regulations do not require the funds in the bank account at time of the garnishment to be social security funds. The only requirement is that the social security check is directly deposited into the account.  

If there is excess money in the bank account – more than twice the amount of the social security deposit – or if a senior has another bank account, a garnishment could temporarily freeze the senior’s account. If nothing is done, the money would be sent to judgment holder.  In that instance a senior would need to file what is called a “claim of exemption.”  This is a form shows the money in the garnished bank account came from monies that were exempt, such as social security, pension, disability or VA benefits. 

Freezes on accounts can be largely avoided by having only one bank account – the bank account into which social security is deposited – and making sure there is never more than twice the amount of monthly social security in that account.

in almost all instances, senior citizens' property is safe.

Sometimes seniors are buying a home or have other property such as a car, furniture or other assets.  They are nervous that a judgment creditor could take property from them, but in almost all instances this should not be a concern for seniors. 

Every state has what are called “exemptions,” laws which list what property is protected from creditors.  This includes exemptions for personal property like a car, furniture and other personal items, in addition to equity in a home.

Most lower income seniors have personal assets close to or less than the state exemptions where they live.  Even if a person has personal property over the state exemptions, unsecured creditors who obtain judgments virtually never go after a person’s personal property.  Why?  Used personal property has very little value.  They would have to file complicated papers with the court, pay expensive court fees, get what is called “bond,” which costs money.  Then they would have to get the services of the sheriff, which also is complicated and expensive. Finally, they would have to account for the senior’s exemptions allowed by law.  This process is so time-consuming and costly that it virtually never occurs with a consumer, let alone a lower-income senior. 


In most states, a judgment would automatically become what is called a “judgment lien” on a person’s real property, meaning a home on land.  Persons are often alarmed or confused about what a “judgment lien” means.  They are worried about losing their home because of the judgment lien.

Almost all states have an exemption for a certain amount of equity in a home called a “homestead exemption.” Many seniors have little or no equity, or they have equity less than the state’s homestead exemption. Even if a person has equity in a home over the state’s homestead exemption, the judgment creditor will almost never take steps to foreclose a lien on a person’s home.  There are many reasons why this practice is extraordinarily uncommon. If there is a mortgage, the lender has to be paid off first. And then, a homestead exemption will need to be paid to the debtor. The process is expensive and very complicated. Any work spent pursuing this option could be foiled by a bankruptcy filing. Finally, if there is little to no equity in the home, a forced sale of the home would end up costing the judgment creditor more than what he could make from its sale.

If the home were sold in the future, there are procedures to protect the proceeds of a person’s homestead equity.  If there were excess equity over the homestead exemption when the home is sold, the “judgment lien” would need to be dealt with by paying it at the sale of the home or paying or settling the judgment before sale.  Even if there is equity in a home over the state’s homestead exemption, unsecured judgment creditors simply let the judgment lien sit there and hope to get paid some point in the future.  A bankruptcy might offer a solution by providing a means to discharge debt, including a judgment now or in the future.  Since many seniors are not presently affected by a judgment lien, they choose to nothing.   


Therefore, in the vast majority of instances, a judgment will not result in a creditor taking anything from a senior. This is why seniors are often told they are judgment proof; they have nothing to worry about.  However, judgment creditors, collectors and debt consolidation companies will never tell a senior they are judgment proof. Instead, they often use intimidation to get a senior to make payments – often payments a senior cannot afford.

HELPS is a 501c nonprofit law firm that represents seniors nationwide who owe debt they can’t afford to pay. HELPS provides seniors with attorneys in order to stop collectors from communicating with seniors.   No qualified senior is ever turned away.  Occasionally, seniors are sued.  We always consult with seniors so they do not unnecessarily worry.  We advise the attorney who filed the lawsuit of the senior’s protected income so their bank account is not touched.  Our mission is to protect and educate lower-income seniors and disabled persons so they can maintain their financial independence.  Any senior or disabled person can call HELPS toll free 855 435 7787 with questions. 

All materials have been prepared for general information purposes only to permit you to learn more about our firm, our services and the experience of our attorneys. The information presented is not legal advice, is not to be acted on as such, may not be current and is subject to change without notice.

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