[Help_Please]

Hello and thank you for taking time out to help me. I will try to keep this brief. For starters in 2003, I purchased a vehicle with a 6 year contract. I paid 429.00 per month faithfully for nearly three years and then became very ill and was unable to work or attend school theirfore I was unable to make my payments as scheduled and after multiple failed attempts of trying to come to temporarty terms with my bank I decided to just do a voluntary repo last year in January 2006.

I know I am responsible for the balance however I'm just lost and need a bit of direction right now.

First: Now a year and a half later I am being served with a summons to court for the balance but have no money. I am attending school full time and live alone with my children. I live on student loans and child support so I would like to know can they get a judgement to take that income away from me?

Second: I understand they can take property (liquid assets) belonging to me such as vehicles, money in the bank, tax returns etc but can they take money out of my childrens accounts as well?

Third: I have herd also that sometimes banks will settle for around 30 cents on the dollar. Is this correct? What are the Michigan laws surrounding all this?

Sorry for all the questions; Thank you kindly for any help you can provide. God Bless!

[Mr. Knowitall]

If you deposit either your child support or your student loan funds in a bank account, you may find that the funds are garnished from that account.

You can contact the creditor's lawyers and see if they will settle the debt for less than you owe. The only way you're going to find out is by asking.

If you try to hide your money in your children's bank accounts and your creditors discover that fact, you can expect that they will pursue that money.

[Help_Please]

Mr. Knowitall,

How can they take my childrens money out of their savings accounts? I'm not trying to hide my money, I want to work out something but I want my children left out of it.

Can they also take my current vehicle and sell it to put towards the balance? I have a lien on it so I don't think they can but I thought I should see if you knew for sure.

Thank you for your time.

[aaron]

If you don't hide your money in your children's accounts, it shouldn't be an issue. I don't see that you followed the instruction to identify your state. Collection laws are different in each state, so check to see what is permitted in your state.

[Help_Please]

Hi Aaron,

I did put my state in my third question. Sorry I should have make it more clear. I am in Michigan.

Do you know how I go about getting them to settle for less? Is there a standard or suggested amount to offer like 30% 50% etc. I was offered to settle today for 70% but countered it.

Thanks again for all your help. God Bless!

[Betty3]

All you can do is see if you & the creditor's lawyer can come to an agree. on a lesser amt. They do not have to accept any offer that you make.

The following are the exemptions in Michigan:
Michigan Post-Judgment Asset Exemptions


Homestead: Real estate to $3,500. Property cannot exceed 1 lot or 40 acres rural. Property held as tenancy by entirety exempt against debt of only one spouse. Spouse or child of deceased owner may claim exemption.

Pensions and Retirement Benefits: Funds exempt for ERISA-qualified plans, firefighters, police officers, legislators, public school employees and state employees. IRA exemptions for conventional, Roth, education, SEP and SIMPLE plans. IRAs limited to contributions that were made more than 120 days before filing, and limited to tax-deductible contributions for non-Roth IRAs.

Insurance: Life, endowment or annuity proceeds if cannot be used to pay beneficiary's creditors. Life or endowment proceeds if beneficiary is insured's spouse or child. Life insurance proceeds if beneficiary is married. Fraternal society benefits. Disability, mutual life or health benefits.

Personal Property: Building and loan association shares up to $1,000 par value, in lieu of homestead. Burial place, church pew, clothing. Family pictures, appliances, books and household goods, up to $1,000 total. Food and fuel for 6 months.

Tools of Trade: Tools, implements, stock, motor vehicle or other items that enable the debtor to carry on his business up to $1,000.

Miscellaneous: Business partnership property.

Wages: Head of household debtors may exempt 60% of weekly wages (but not less than $15.00 per week) plus $2.00 per dependent other than spouse. Other debtors may exempt 40% of weekly wages (not less than $10.00 per week).

Public Benefits: Veteran's benefits. Workers' compensation. Unemployment compensation. AFDC. Crime victim's compensation. Social welfare benefits.

Wild Card: None.

[Help_Please]

Thank you Betty 3 for all the information on Michigan laws.

[Betty3]

You're welcome.