Need help ASAP Michigan

[dbig9937]

I am in Michigan.My dad has run up approx. 25 thousand in credit cards debts. My mom is not on the cards, but is worried about loosing their modular home or her car. Can this happen. The car is in her name only, the house is in both names. Also, he is retired and recieves his retirement pension, and she gets a small social security benefit. Can they garanshie those payments. My dad has cancer an is in very bad health, and my mom is 84 with light medical issues. She is so scared that she will loose what little they have left. Any advice you can offer will be a blessing. Up until the calls started coming, she had no idea these cards/debts existed. Thankyou in advance.

 

[Debt Guy]

Q. My mom is not on the cards, but is worried about loosing their modular home or her car.

A. If mom is not on the cards, she is not personally liable for those debts.

Q. Can this happen. The car is in her name only

A. Then the car cannot be touched by creditors.

Q. the house is in both names.

A. There is some vulnerability here. I assume the home is owned in joint tenancy. The creditor can get a judgment and then attach his portion of the ownership. It is highly unlikely they can force the home to be sold -- but, the attachment will sit there until they decide to sell the home and then will have a claim junior only to the first lein lender. However, only the portion of the equity in excess of $30,000 is vulnerable since MI allows an exemption of $30,000 -- but, you really need to talk to an attorney since I have no idea if a "modular home" is considered real estate in MI -- some states are yes and some are no on that issue.

Q. Also, he is retired and recieves his retirement pension,

A. Most pensions are exempt from garnishment. He should call the pension manager and ask.

Q. and she gets a small social security benefit.

A. Social security is exempt from garnishment.


Others with different opinions will chime in.

 

[Ladynred]

Given the age of the OP's parents, I'll just add one thing. If there ever is a judgment lien placed on the property and your parents both pass away, the debt/judmgment lien would have to be paid out of the estate unless the estate is insolvent. In no way would the children be liable for the debt.

It MAY be worth looking into a reverse mortgage on the home.

 

[dbig9937]

Thankyou, 1 more thing

Thanx so much for the help here.I have 1 more question, how would my mom go about having only her name on the modular. My dad has agreed to the removal of his name on this, but we are unsure what has to be done to switch this. Once again, thankyou. ~ Denise in Mich.

 

[Debt Guy]

You need the help of a local attorney to do this properly.

 

[Ladynred]

I would agree, but what you are referring to is called a quit-claim on the deed.

 

[Ohiogal]

Thanx so much for the help here.I have 1 more question, how would my mom go about having only her name on the modular. My dad has agreed to the removal of his name on this, but we are unsure what has to be done to switch this. Once again, thankyou. ~ Denise in Mich.

If your dad does this at this state, the creditors could still attach it if it is in your mom's name only. It could or would be seen as a fraudulent transfer -- transferred to avoid garnishment of debt. You really can't safeguard your dad's property from having liens placed upon it because he did run up the debt.

 

[Debt Guy]

Fraudulent conveyance is a legal term. Yes, there is such a thing. Yes, creditors can under certain circumstances unwind an asset transfer if a judge agrees that the asset was conveyed fraudulently. Typically, there is a waiting period, after which the conveyance is no longer fraudulent.

This is one reason you need to consult with an attorney who practices in your state.

 

[Ladynred]

He hasn't even been sued, so it's not an issue and how would a creditor prove it was done "fraudulently" anyway ? He's elderly and in ill health, sounds like estate planning to me