questions & answers

Question: My husband and i are both on Social security and we have credit card debit and can't make the payments on them, what can the credit card company do to get there money. We have got a letter to go to court for one of them, can they make us pay them?

Answer: Generally, when a person requests and uses a credit card, he or she is agreeing to abide by the written terms of the contract with the credit card issuer. One of those terms is payment of the debt. Because a credit card holder agrees to abide by these terms, the failure to pay is a breach of the credit card contract. As a result, the credit card issuer (creditor) may ask the court to rule on the validity of the debt so that it can be collected by garnishment of the person’s wages to pay off the unpaid balance owed by the card holder (debtor). If a creditor in a legal action against a debtor has been awarded a money judgment (for the unpaid balance on a credit card, for example), that creditor (now called the judgment creditor) can make a written request to debtor’s employer (called the garnishee) that the money owed to the creditor be taken from debtor’s (now called the judgment debtor) earnings and paid to creditor (this is the act of garnishing debtor’s earnings). A.R.S. Section 12-1598.04 at (http://www.azleg.gov/FormatDocument.asp?inDoc=/ars/12/01598-04.htm&Title=12&DocType=ARS) discusses the garnishment procedures. There are limitations to what property or money can be garnished so that the judgment debtor is still able to survive. Generally, monies owed to the garnishee or debtor can be garnished and this includes wages, salary, commissions, bonuses and other forms of payment. For other information and answers to questions about consumer credit issues, visit the Federal Reserve at (http://www.federalreserve.gov/consumerinfo/default.htm)