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No. Social Security, like most government assistance, is completely off-limits to creditors. This means that creditors cannot take Social Security payments. As a society, we have decided that those who are unable to work should not harassed by creditor garnishment. Social Security payments are not large amounts of money, so Social Security recipients should be able to keep their benefit payments for personal needs.
There are two important things to keep in mind. First, creditors can still collect against non-exempt assets. This means that creditors who have judgments can take property not shielded by the laws of the debtor’s state. After the creditor takes the property, it can sell it in order to pay off the debt. If that process does not completely pay off the debt with the sale, the creditor can keep taking non-exempt property until the debt is paid in full. It is important to remember that creditors cannot come after ALL of your property, only property not protected by statute.
The second thing to remember is that there is nothing preventing a creditor from asking for a payment. Often, a creditor will ask a Social Security recipient if he or she would be willing to continue making payments. There is nothing preventing a debtor on Social Security from agreeing to an arrangement. That said, a debtor should remember that Social Security payments are off-limits to creditors and the creditor will not be able to take Social Security payments without the debtor’s consent.
If you have questions about Social Security payments and debt, or any other consumer matters, please feel free to contact the professionals at Lakelaw (866-LAKELAW, or 262-694-7300 in Wisconsin). We specialize in helping people get their financial houses in order while treating clients with Care, Kindness, Courtesy, Respect, Professionalism and Dedication.
This post was drafted by Nicholas Strom, Lakelaw attorney