Bankruptcy Indiana

It's sad when senior citizens are driven to the point of filing individual bankruptcy in Indiana, but, let's face it - that's happening more and more.  Why? you may ask.  Well, as a debt consolidation lawyer offering bankruptcy information in Indiana, here's what I see:
 

• Most older Americans are on a fixed income.  When costs rise for basics such as food, fuel, and medication, seniors may have a hard time keeping up.
   
• Parents dug into their own finances to help adult children copy with job layoffs or to help foot medical bills for children or grandchildren.
   
• Seniors are often targets of scams of different types, including identity theft.

The silver lining when it comes to social security payments is that these are exempt from creditors under the new bankruptcy laws of Indiana.  (In fact, I helped write the exemptions portion of Indiana bankruptcy law.)

• When the bankruptcy trustee is considering what assets a debtor might have available to pay creditors, social security benefits won't count.

• When the court is considering what a debtor's disposable income is for a bankruptcy "budget", however, the money coming in from social security will be considered part of income.

With almost twenty-five years' experience helping individuals file bankruptcy Chapter 7 in Indiana, I would normally find the treatment of social security benefits to be a very simple matter.  But ever since social security stopped sending paper checks and started automatically depositing benefit payments into recipients' bank accounts, problems began happening. 

Debt collectors can request that bank accounts be "frozen".  That prevents account holders from withdrawing money before creditors can collect on legal claims, New America Media explains. In fact, as of 2008, according to the Social Security Administration itself, there have been $178 million in garnishments of social security money out of bank accounts. Even though the social security money is supposed to be exempt from creditors, the bank doesn't separate which money came from where when it follows a legal order to freeze an account. 

As an Indiana lawyer for bankruptcy, I was glad to learn that the AARP has been working to have federal regulators take steps to protect social security recipients from having their benefits garnished out of bank accounts.

Meanwhile, the Columbus bankruptcy lawyers and the Indianapolis, Anderson, and Bloomington bankruptcy attorneys who work in the Mark Zuckerberg bankruptcy law offices are all still reporting problems with social security benefits getting caught in the garnishment "web".  The same type of problems, unfortunately, have been occurring with social security disability benefits, which is even sadder.

Whatever the age of my Indiana bankruptcy clients, I keep doing all I can to make sure the bankruptcy safety net works to offer them the fresh financial start bankruptcy in Indiana is all about!