A bankruptcy can stop creditors from taking your property
By: Darrell Castle
Hello, my name is Darrell Castle and I’m an attorney licensed to practice law in the state of Tennessee and on this video, and in future videos, we are talking about collections. This will be the first in a series of videos about collections.
When you have debts that you cannot pay on time, every time, what can the creditor (the person you owe money to) do to enforce collection of his debt or to enforce payment of his debt.
Some of those things, of course, depends on the nature of the debt. If you have a home mortgage and you miss mortgage payments, mortgages are protected by law, so the creditor has to go through a legal process we call foreclosure in order to transfer home ownership from you to him. And we’ll talk about all these things in other videos.
If you have a car and you miss car payments, here in my jurisdiction of Tennessee, we have what is called self-help repossession. So if you miss a car payment, the car creditor (which is who you owe your car payment to) does not have to do anything legally to take your car. He can simply send someone out to tow it away. That is what the law allows him to do here.
Then you have things such as credit card debts, medical bills, other debts that we refer to as unsecured. That just means there’s no property that would be lost if those debts aren’t paid. Their remedy is something else and that is using wage garnishments.
They can take a certain amount of your wages every week by force, by legal force – by court order – in order to force collection of your debt.
Now the trick to all these things of course is to catch them before they happen.
In other words, you know you’re behind on your bills. You know that you are struggling financially. Perhaps you’ve had a lost job or you’ve undergone a divorce or some other tragedy has happened in your life, but for one reason or another, you have debts you simply cannot pay and you know that in advance.
So the trick is to take action while you still can – while the decision-making process is in your hands and not in someone else’s hands because I can assure you – I can guarantee you in fact that in a short period of time it will be in someone else’s hands and you’ll start losing property.
There are steps you can take to protect yourself in advance of creditors taking your property.
What are those steps? Well, those are the subjects of the future videos – we’ll talk about them then.