*Details about the Bankruptcy Bypass program may have changed since the publication of the article below. Please contact Legal Aid for assistance at 888-817-3777, or view information about Legal Aid’s Debt and Protected Income Project.
Creditors often give people wrong information about what they can collect. Creditors frequently call and send notices, causing many people to fear they will be charged criminally for not paying their bills. Legal Aid can help people, often seniors and persons with disabilities deal with these types of creditors through its Bankruptcy-Bypass Program. If you are eligible for the Bankruptcy By-Pass Program you do not need to file bankruptcy and you do not have to fear that your money or assets will be taken by creditors.
You are eligible for the Bankruptcy By-Pass program if your only income is from a protected source and you do not own your home or plan to work full time again. Types of protected income include social security, SSI, SSDI, and veterans’ benefits. These income sources cannot be taken out of a bank account by a creditor. If your only income is from a protected source, you are considered “judgment proof.” “Judgment proof” means that creditors cannot take your income under the law. For eligible clients, Legal Aid will notify creditors that you are “judgment proof.” Often, when the creditors are notified, they stop calling and they stop trying to collect. Many clients say that it feels as if a weight is lifted once the creditors stop calling and stop trying to collect.
Additionally, federal law protects individuals who make less than minimum wage by limiting the amount of earnings that may be taken in any workweek. In Ohio, the first $217.50 from each weekly paycheck cannot be taken by a creditor, even if they have a judgment from the court. Therefore, if you have debt, but earn very little money, filing for bankruptcy may not be the best choice. People can only file a personal bankruptcy once every eight years and you should only do so when it will be to your greatest advantage.
In the last year alone, Legal Aid has helped over 70 clients through the Bankruptcy By-Pass Program. If you think the Bankruptcy By-Pass Program can help you, call Legal Aid at 1-888-817-3777 to apply for help.
This article was written by Allison Meyer and appeared in The Alert: Volume 34, Issue 2.