Can My Son’s Creditors Take My Social Security for His Loan that I Co-Signed?

“I cosigned for my 18- or 19-year-old son to get a credit card somewhere around 1999 or 2000. The limit on the card was $1200. I had to relocate for employment reasons and I left him with the responsibility. In about 2003 I was contacted and he owed $6,000 on the card. He was in so deep he could not get out, so he filed bankruptcy. He (and I) were under the understanding that filing bankruptcy would discharge him from the debt. He said his attorney said the credit card company could not come back on me for it. They have been calling me persistently for short periods of time. I am permanently disabled (am on SS Disability) with a malignant and inoperable brain tumor). I told them I would give them the initial $1200 I cosigned for but they want it all and I cannot, of course, afford it!

Can they take my Social Security disability check? It is direct deposited into my checking account each month. Should I try to have it sent directly to me instead, or into another account?

Since the time I cosigned for this credit card, I have married and my husband will not help me with this situation. He says my son should pay it and I (and he) will pay NOTHING because it is not our debt. My son filed bankrupty and cannot pay anything on this. When they call me I get upset and cry and my headaches get horrendously worse. I know it is the stress imposed by their sometimes “nasty” phone calls.

What would YOU do? I cannot afford an attorney. I have nothing to my name except my 2002 Monte Carlo and I need that for people to take me to the doctor appointments!”

It would take analysis of the original contract that you co-signed on to determine the extent of your potential liability. According to section 808 of the Fair Debt Collection Practices Act (FDCPA):

“A debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt. . . . the following conduct is a violation of this section: (1) The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.”

So the extent of your potential liability may just be the $1200, and any interest or penalties you may have agreed to, or some other amount allowed under the laws of your state, or the state law that covered the contract.

The very short answer on whether they can take your Social Security Disability check is “probably not.” Under Section 207 of the Social Security Act: “The right of any person to any future payment under this title shall not be transferable or assignable, at law or in equity, and none of the moneys paid or payable or rights existing under this title shall be subject to execution, levy, attachment, garnishment, or other legal process, or to the operation of any bankruptcy or insolvency law.”

This is legalese for the collection agent can’t force the Social Security Administration to pay them first. Had this been a debt owed to the government for taxes, or for a student loan, or child support, the answer would be a little more complicated. Sometimes state laws have a way of complicating things, too, but probably not for you.

For the most part, in order to get at your bank account, this debt collector is probably going to need a judgment of some kind. This means that they will have to sue you (likely in small claims court), and you’ll know about it, and have the chance to respond.

You asked “what would I do?” which is a loaded question. First off, I would not co-sign on anything unless I was willing and able to bear the consequences of default. At the very least, you are probably going to get a bad mark on your credit report when this is all over. I would review the contract I signed to figure out exactly what the extent of my liability is, and see if this is an amount I could afford to pay. Any agreement to charge off the debt for less than the full amount needs to be explicit and in writing. If I really had nothing, and I really could not afford to pay anything, I would review the statute of limitations of my state to see how quickly the creditor would need to sue me on the written contract to figure out by when they needed to act.

If you have decided to give up on trying to work something out, you really are not going to be able to pay if it is just up to you and them, and that they only way forward for them is through legal action, you can get them to stop calling you. Under FDCPA section 805 Communication in Connection with debt collection, section (c) provides: “CEASING COMMUNICATION. If a consumer notifies a debt collector in writing that the consumer refuses to pay a debt or that the consumer wishes the debt collector to cease further communication with the consumer, the debt collector shall not communicate further with the consumer with respect to such debt, except — (1) to advise the consumer that the debt collector’s further efforts are being terminated; (2) to notify the consumer that the debt collector or creditor may invoke specified remedies which are ordinarily invoked by such debt collector or creditor; or (3) where applicable, to notify the consumer that the debt collector or creditor intends to invoke a specified remedy. If such notice from the consumer is made by mail, notification shall be complete upon receipt.”

So, if you can figure out what you owe them and pay them that would be best (or better yet, what about that son of yours!?). If you can’t pay, you might be able to at least save your health by getting them to stop calling you, and let them decide if they are going to try to take further actions.