Elderly and Owing in Ohio
In the United States, in 2019, just over 6 out of 10 households led by someone 65 years or older had some kind of debt. The typical amount owed by these senior-led homes was around $34,000. [1]
When an elderly person in Ohio passes away with outstanding debt, the responsibility for paying that debt generally does not automatically transfer to their loved ones unless they are co-debtors. Instead, the debt is typically handled through the deceased person’s estate during the probate process.
Elderly Debt Collection
Every person, no matter how old they are, is safe from being treated unfairly by debt collectors because of a law called the Fair Debt Collections Practices Act (FDCPA). This law was passed by Congress in 1978. It tells debt collectors what they can and cannot do when trying to get money from people. [2]
Moreover, when a senior sends a “cease and desist” letter to a debt collector, the collector has to stop contacting them. Also, if the senior has a bankruptcy lawyer, the debt collector should only contact the lawyer.
Statute of Limitations
Ohio Revised Code § 2305.07 says that creditors have six years to sue someone for most debts, like credit cards or medical bills. After six years pass, they are not allowed to take the elderly to court to try and get the money back.
Garnishment Limits
The Ohio Revised Code § 2329.66 talks about what things cannot be taken away if someone owes money. For example, if you own a house, up to $125,000 of the home’s value is safe. You can also keep household items worth up to $10,775. If you have a car, it is safe too, as long as it is not worth more than $3,225. [3]
Filing for Bankruptcy
Many older adults who are dealing with large amounts of debt find themselves in a tough spot. The pressure and worry can be even worse for those with health issues and rising medical expenses. Instead of continuing to struggle and possibly risking their homes, seniors might want to look into options like debt relief. Filing for bankruptcy could help lower debt and offer a way toward a better future.
Debts That Can be Discharged through Bankruptcy
When seniors file for bankruptcy, there are many debts that can be erased. This means they no longer have to worry about paying back things like hospital bills, credit card balances, and unpaid utility bills.
Bankruptcy was created as a way to help people reset their finances, allowing them to get back on their feet and enjoy life without constantly worrying about bills.
How Can Declaring Bankruptcy Benefit Someone Who is Elderly?
When someone files for bankruptcy, the law requires creditors to stop trying to collect money, which can bring a big sense of relief. Sometimes, filing for bankruptcy can also pause the foreclosure process, giving a person some time to figure things out.
Most of the time, things like retirement savings, pensions, and Social Security benefits stay safe and cannot be taken by creditors. But things can get tricky when it comes to homes, especially for older people who might own their homes without a mortgage and have a lot of value tied up in them.
How much of a home’s value can be kept safe during bankruptcy depends on whether it is eligible for the homestead exemption. This protection concerns the home’s equity, which is the market value minus any debt, not the full value of the house or any remaining mortgage.
The most beneficial type of bankruptcy for a senior is usually Chapter 7 bankruptcy. It is sometimes called a “fresh start” option. It is suitable for people who do not have enough income to cover their basic living expenses. This also includes debts like credit cards, medical bills, and personal loans. The process typically wraps up in just a few months. It can give a senior a clean slate and a chance to rebuild their credit without being weighed down by heavy monthly bills. After completing Chapter 7, most debts are gone.
However, the court might require the selling of some belongings to pay off creditors. But, many times, people can keep their homes and cars as long as they agree to continue making their mortgage or loan payments each month.
If you are an elderly person in Ohio who is in debt and needs debt relief, then contact Richard West today.
FAQs
Older folks in Ohio have some help from the Fair Debt Collections Practices Act (FDCPA) to stop debt collectors from being mean or sneaky. If they send a “stop bothering me” letter, the debt collector must leave them alone. Plus, if they have a lawyer, the debt collector has to talk to the lawyer instead.
Creditors in Ohio have six years to go after most debts like credit card or doctor bills. After that, they cannot drag seniors to court to get the money.
Chapter 7 bankruptcy, sometimes called a “clean slate,” is for people who cannot cover their living costs and debts. It often clears most debts quickly, but some personal items might have to be sold to pay off creditors.
Usually, Social Security benefits are protected from creditors in bankruptcy. But it is smart to talk to a lawyer to know exactly how it applies to you.
Sources:
[1] Get the Facts on Economic Security for Seniors. (2024, June 1). https://www.ncoa.org/article/get-the-facts-on-economic-security-for-seniors/
[2] Milliken, M. (2023, April 28). Elderly Debt Collection Laws. InCharge Debt Solutions. https://www.incharge.org/debt-relief/credit-counseling/bad-credit/collection-laws-for-seniors/
[3] 2006 Ohio Revised Code – 2329.66. Exempted interests and rights. (n.d.-b). Justia Law. https://law.justia.com/codes/ohio/2006/orc/jd_232966-5a95.html
