Sued in Texas over credit card debt

[eruiz97]

What is the name of your state? Texas

Sued over credit card debt - about $10K. I own a home, I have a job. I cannot pay due to being out of work for three years and having alot of accounts go bad on me. I have settled other accounts but this one wants to sue. If I don't respond they claim they will win judgement. Can they place lien on house - what will this specifically do to me and my home? Can I lose it over this amount? Can they garnish my wages? Can they take or dip into any bank account I have? I have heard that Texas is a debter friendly state and they can get the lien on the home but that is about it. They would collect only if I sold my home - fact or fiction.

Any help would be appreciated.

[Ladynred]

If I don't respond they claim they will win judgement.

If you've been served a summons, YES, by not responding they get a default judgment against you automatically.

TX has a 100% homestead exemption, they cannot take your home and I'm not sure about the lien.. too late for me to look up TX statutes tonight.

Wages cannot be garnished in TX.

However, bank accounts are easy pickings and they will drain any accounts they can find down to zero. They can also go after any non-exempt property and cart it off to auction.

Judgments in TX are basically indefinite.. so its not what ya got today, its what you might have 2, 5, 10 years from now that they'll take from you !

[toughluck73]

"Can they place lien on house - what will this specifically do to me and my home? Can I lose it over this amount?"

No, you will not lose it, and they CAN'T place a lien on it. Basically, your house is safe.

"Can they garnish my wages?"

NO, Texas doesn't allow it.

[eruiz97]

What is exactly meant by non-exempt property?

I have a checking account only - can they touch that? My wages go in there. Wouldn't it be a form of garnishment of wages if they touched the checking account?

So they win judgement, they can't touch my house or wages - what does this mean? They don't collect, they merely have a judgement against me that stay on my record? Is that it?

I have settled all my other accounts except for this one. They just flat refuse to settle for anything less than the full amount. I have offered them in writing to settle for 6K but they are still refusing it.

[Ladynred]

What is exactly meant by non-exempt property?

Anything not on the exemptions list or above the allowed amounts.

I have a checking account only - can they touch that? My wages go in there. Wouldn't it be a form of garnishment of wages if they touched the checking account?

Yes, they can go after your bank accounts, and no its not wage garnishment, its a bank levy at that point.

So they win judgement, they can't touch my house or wages - what does this mean? They don't collect, they merely have a judgement against me that stay on my record? Is that it?

Hardly. They CAN put a lien on your house, for one thing. The exemption means they can't TAKE it from you. A judgment in TX is good for decades, so its not what you have now, its what you may have later that they'll be looking for and they can KEEP coming at you for years and years.

[toughluck73]

There seems to be some confusion over whether a lien can be placed on a home in TX. The answer is no, not for credit card debt. Read below for more info. Also, judgments in TX are good for 10 years, renewable indefinitely.


TEXAS EXEMPTIONS

(These exemptions are available whether or not you file bankuptcy)

HOMESTEAD:

Article 16 of the Texas Constitution provides for a Homestead Exemption for Texans. A city homestead has 10 acres of land and the home on it. A rural homestead has two hundred (200) acres of land, and the structures on them. You may have either a city or rural homestead, but not both.

The only types of liens that are good against a homestead are:

Liens for purchase money loans (money that you borrowed to buy the property);

liens for home improvements;

home equity loans; and

liens for taxes.

Accordingly, general creditors cannot seize the homestead and it does not pass to a trustee in bankruptcy. You must continue to pay the creditors with legitimate liens on the homestead or they can foreclose.

Also, contrary to what some people believe, a creditor who has a judgment does not have a lien that is good against a homestead. But, when you go to sell your homestead, you may have a problem. If there are judgments against you, a title company probably will refuse to issue a title policy unless the judgments are removed or the funds escrowed with the title company to pay the judgments. It is usually the title company's position that it does not know whether the property is really homestead or not. It simply will not take the risk that the property is not homestead.

For the property to be homestead, it is not necessary that you have claimed it as such for the purposes of property taxes. You should reside in the property or maintain your business there. In addition, homestead is a "state of mind." That is, you should intend that the property is your homestead. Even if you currently live elsewhere or have temporarily rented the homestead, it may not lose its homestead character if you intend to return.

[RubyJuly57]

State of Texas - how long after a default judgment is decided in favor of a creditor does the debtor have to appeal? Can the creditor go after the bank accounts right away or do they have to wait until the appeal time is over?

[Tayla]

Just a thought as I was reading this entry...

the poster stated being unemployed so not sure how any *wages* are going into the bank account, unless its from the spouse or a joint member to the account.

[Ladynred]

Ahh... but the poster IS working:

I own a home, I have a job.

[Tayla]

Thank you Lady for clarifying that !

I still find his/her post confusing because right after, he/she says they've been unemployed for three years. Never' the less this is a law forum so I'll be quiet now...