# Can credit card companies take your land?



## Horns Bach (Mar 11, 2008)

I owe quite a bit on my two credit cards. My land (40 acres) is paid for but there is no legal dwelling there, it's off the grid.

If the economy collapses and I can't afford to make credit card payments, can they take my land? The purchases on the cards are in no way tied to my property.

I have a good secure job but I worry if something interferes with that (economic collapse). All the preps on my land will mean nothing if it gets taken.

As far as I have heard the credit cards can't take your home, but since my home isn't a legal dwelling and it shows as just raw land, I wasn't sure if that made a difference. 
Thanks


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## texican (Oct 4, 2003)

Basically, YES.

My sister has holes in her pockets... has never been able to hold on to a red cent for more than a millisecond... After my parents passed away, she bought a new home, and instead of paying cash, she got a mortgage, then maxxed out some cc's to furnish the house... Had Cash, but put it on CC's...:flame::flame::flame: Blew the money on expensive (imho) horses, clothes, ephemeral stuff...... Thought she could walk away from her cc debts... didn't show up for some court hearings, after a cc company sued her. Judge gave a judgment to the cc company. They couldn't take the land, but she couldn't sell it either. When the rest of the family decided to sell (a lot of people in an undivided interest parcel), she found out they had a judgment against her land... and she got nothing... lost 6k worth of land, over a 2k bill!!! Interest accrued at 21%...

So, if it's not your homestead, you might end up with a judgment against you, or a lien... land will be yours, but before you could do anything with it, (get loans, sell, subdivide) you'd have to pay off the debt.

Moral... don't go into debt... course, you probably know that...

I wouldn't worry about it getting taken... if the system falls, you might come out smelling like a rose... better to have debts forgiven/forgotten, imho, than to have financial assets stolen/taken/confiscated/devalued...(my case)...

good luck...


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## highplains (Oct 5, 2006)

I know before the big changes in bankruptcy they could not.
There are a few things, number one - if your land is out in the boonies it's probably safe. If it's close to a development - yep they will try to if they can. CC companies will go after anything to recoup debts.
If it really hits the fan - nope just head for your safe place, CC companies aren't going to be making alot of headway then.


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## donsgal (May 2, 2005)

Horns Bach said:


> I owe quite a bit on my two credit cards. My land (40 acres) is paid for but there is no legal dwelling there, it's off the grid.
> 
> If the economy collapses and I can't afford to make credit card payments, can they take my land? The purchases on the cards are in no way tied to my property.
> 
> ...


A lot of that depends on where you live. Some states have a homestead exemption, but if you are not living on the property as your primary residence, it may not qualify for that exemption, if your state has one.

Your credit card company has to sue you first and get a judgment and then they can force you to sell your assets to cover the judgment amount. The only way that you can protect your property, making it judgment proof is through a Family Limited Partnership. You can google that for more information. Be advised that Trusts DO NOT protect your property from judgments. 

Getting rid of the debt is a better plan, imho.

donsgal


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## Gary in ohio (May 11, 2002)

Can they just take your land NO! Can they sue for payment and win a legal judgment, possible. First How much you in debt, You would be surprised how much people think its a lot of CC debt that to a company isnt. Even if they decide to take it, its going to take several years before that would happens. TALK TO the CC companies, Yes they are going to be A-holes, Yes they are going to call you every day wanting there money, but talk with them. Tell them how much you can pay and then PAY what you say you can pay.
If you DONT get the high interest on the CC card stopped you will NEVER pay down a card. Get one of the credit card debt broker services working with you, They can negotiate with the CC companies for payments you can make. It might take you ten years to pay it off but you can pay it off. Finally STOP using your CC


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## WolfWalksSoftly (Aug 13, 2004)

Credit Cards are *Unsecured loans* .


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## Gercarson (Nov 2, 2003)

Along these same lines - if a credit card company "gets" a judgement is it permanent? Is there a time limit on the judgement?


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## Gary in ohio (May 11, 2002)

WolfWalksSoftly said:


> Credit Cards are *Unsecured loans* .


Credit cards are DEBT! The land isnt collertal so they can just step in and grab it, but they can sue for payment and will unless you file bankrupsy win the judgement. They will force a sale of the property (they DONT want your property, they want the money). to satisfy your debt. Now granted this is going to take years to happen but if you do nothhing it can happen.


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## donsgal (May 2, 2005)

Gercarson said:


> Along these same lines - if a credit card company "gets" a judgement is it permanent? Is there a time limit on the judgement?


It is only good for a period of time, but they can "renew" it through the court system in order to continue to collect on it.

donsgal


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## edcopp (Oct 9, 2004)

Gercarson said:


> Along these same lines - if a credit card company "gets" a judgement is it permanent? Is there a time limit on the judgement?


Each state is different. The judgements are NOT permanant. For instance in Ohio a judgement is good for 20 years and can be renewed for another 20. The judgement will in most cases, stop you from selling the property or getting a loan on it.


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## Horns Bach (Mar 11, 2008)

Thank you everyone for your replies. I don't ever plan on selling, and I am paying the debt off as quickly as I can.


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## mightybooboo (Feb 10, 2004)

I won a court judgment and they didnt pay it.

When he went to jail on something else it was added to his Bail! When he bailed out my judgment was part of it.

I got my check in the mail from the state.

FWIW,but he surely wasnt able to walk away from the court ordered judgment.


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## pmondo (Oct 6, 2007)

edcopp said:


> Each state is different. The judgements are NOT permanant. For instance in Ohio a judgement is good for 20 years and can be renewed for another 20. The judgement will in most cases, stop you from selling the property or getting a loan on it.


judgements are permanant every 20 years they can be renewed in every state 40 years is as permanant as i want to get


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## DavidUnderwood (Jul 5, 2007)

NOT in every state.
In NC a judgement is for 10 years.
It is renewable, if the creditor still
cares at that time.
BTW, you can be sued for money owed.
Any money, to anybody.
Would it not be sad if there was no recourse
for a lender, in need of collecting an honest debt?


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## AngieM2 (May 10, 2002)

And any judgement is only as good as the collection vehicle/device/person.

Angie


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## Spinner (Jul 19, 2003)

They can get a judgment against you in court, then use the judgment to force sale of the land to satisfy the judgment. They can't touch it if you have a land patent or a land trust. If you have a deed in your name, they can take it. There are ways to protect your property, but you'll have to move fast to get it done before any judgment is ordered.


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## hfwarner3 (Feb 19, 2008)

AngieM2 said:


> And any judgement is only as good as the collection vehicle/device/person.


Don't write off a judgment or a lien. Try selling your house when there is a lien on it. Try putting any significant amount of money in any account when there is a judgment against you. Try getting any job worth having and not get your wages garnished. And we already heard the story about having the judgment amount added to your bail if you get arrested.

Sure, you can go completely underground and live in a hole with no income, no money, and own nothing worth anything. You could...


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## hfwarner3 (Feb 19, 2008)

Spinner said:


> They can get a judgment against you in court, then use the judgment to force sale of the land to satisfy the judgment. They can't touch it if you have a land patent or a land trust. If you have a deed in your name, they can take it. There are ways to protect your property, but you'll have to move fast to get it done before any judgment is ordered.


And even then it needs to be done right (read "pay a good lawyer") or else it will be thrown out in court since you are just hiding assets to avoid collection.


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## AngieM2 (May 10, 2002)

hf - you're right..

Let's just say, I've "won" a few and my collection device was not good., and it was years ago - the legalese may have changed since then.

Angie


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## mightybooboo (Feb 10, 2004)

All I know is Ca. so I dont know if this is everywhere...

You can file a 'Homestead' on your house.In the event of a lawsuit they cant take (force sale) your house and a couple acres,but all the other acreage is up for grabs.


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## mightybooboo (Feb 10, 2004)

AngieM2 said:


> And any judgement is only as good as the collection vehicle/device/person.
> 
> Angie


A lot of folks will swear thats the truth from personal experience.


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## Karen (Apr 17, 2002)

As a retired paralegal ( 20 years doing bankruptcy/civil suit/commercial litigation; along with a few years of personal injury law), here's the _real_ story. 

First a little info on what a judgment is. In order to obtain a judgment, the creditor has to sue you in court. In order for you to win your case, you would have to prove that you do not owe the debt (ie: you never had credit with that company; accounting error on the part of creditor, etc.). Not having the ability to pay is not a legal defense.

When your creditor wins his case, the judge signs an Order for Judgment. The order is filed with the clerk and the time begins on that day (not the day the judgment was signed or granted).

Having a judgement against you means that your creditor is able to collect on the judgment by _any and all legal means possible_, allowed by your state, in order to collect his money. That means, garnishing your bank account, your wages, and attaching any assets you own free and clear (your car, farm equipment, tools, furniture, etc.).

They cannot, however, attach an asset that is owned by you jointly with someone else. For instance, if the judgment is in your name only (not jointly with your wife); then they cannot attach any assets you hold together. However, under certain circumstances (being however hard the creditor wants to push for collection), _some_ states permit the garnishing of the husband's part of the assets. 

A credit card like a Visa, Mastercard, Discover, American Express, etc. is unsecured; however, that just means that the purchases you made with the card are not held as collateral. It does not mean that they can't sue you and obtain a judgment.

A credit card with a department store, furniture store, etc. is a secured debt. That means they can repossess anything you have purchased on that card. The kicker is, that doesn't wipe out your debt. The difference in what they ended up reselling the items for, minus your debt, still stays as judgment against you until you pay the remainder. 

Same goes for any collection on a judgment.

The time frame a judgment is good for depends on what state your in. Each state has their own laws - including how long it can be renewed for. 

Whether your home or property can be foreclosed on, depends on whether or not your state has a homestead exempt law. Not all states have them. If your state doesn't, it means they can either place a lien against the property, or they can foreclose on the property.

Again, it isn't the "value" of your property that settles your judgment. It is for how much your property resells for. The balance still stays with you as a judgment until paid in full.

Generally, when a judgment is filed, you will be called in for a deposition. You will be required to bring all financial records, tax returns, bank account records, deeds to any and all property, title to all vehicles, home inventory, etc. They will run a background check and then depose you (under oath) to determine what actual assets you own in order to settle the judgment.

If you don't have any at that time, they generally will depose you again just before the judgment is up for renewal. In larger judgments, they will often subpoena you for deposition several times a year -- for years.

Judgments also can be transferred to other states. In other words, if you move, they follow you for all eternity.

The problem with Judgments are that they aren't just for the money you owe. The creditor is also granted his attorney fees and costs to bring the action; plus any future charges (depositions, etc.) that occur; plus interest (which accumulates for the entire length of the judgment -- at the current highest allowable interest rate established by your state). You end up owing a ton more than the debts was for.

Judgments also stay on your credit report for as long as the judgment is held against you - plus 7 years after the judgment is satisfied. Future creditors (as well as your credit rating) looks upon a judgment more harshly than bankruptcy. Mainly because it is a long outstanding, unsatisfied, debt that is accruing interest; thus reducing your net worth as the interest accumulates. 

So you can see why judgments are really big deal and you want to avoid them at all costs.

A word of caution about making any changes on deeds/titles/etc. at the onset of your court appearance. It is not legal for you make those changes and you could face severe fraud charges. Generally, the court will consider any major transfers of property within 6 months of the Judgment Hearing as fraud.


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## Explorer (Dec 2, 2003)

Great explanation Karen. I have a question for you. It is my understanding that companies as Visa and Master Charge are only processing agents for the credit owner. My monthly Visa charges are processed by the Visa company, but the actual account (debt) is owed to my bank that holds the "loan". Do I understand this correctly?


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## RichieC (Aug 29, 2007)

Spinner said:


> They can get a judgment against you in court, then use the judgment to force sale of the land to satisfy the judgment. *They can't touch it if you have a land patent or a land trust.* If you have a deed in your name, they can take it. There are ways to protect your property, but you'll have to move fast to get it done before any judgment is ordered.


This is wrong. Please, nobody act in reliance on this advice.

The law varies from state to state, but what Karen writes in an excellent rule of thumb.


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## Spinner (Jul 19, 2003)

Maybe it doesn't work that way in your state RichieC, but it works that way in my state and the state I used to live in. Everyone needs to check their own state laws.


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## Karen (Apr 17, 2002)

Explorer said:


> Great explanation Karen. I have a question for you. It is my understanding that companies as Visa and Master Charge are only processing agents for the credit owner. My monthly Visa charges are processed by the Visa company, but the actual account (debt) is owed to my bank that holds the "loan". Do I understand this correctly?


I'm sorry for the delay in responding, Explorer. I totally forgot about this thread. 

Yes, you are correct. Your actual "creditor" is the bank that issues the credit card.

Spinner, is correct in that some states do recognize land trusts/land patents as exempt from Judgment collections. I do recall, however, only a couple of states do, however, so don't bank on that one (or assume your state still does) have that exemption. After the bankruptcy law changes, that one was changing rather rapidly.

Also, remember the fraud issue! That one is a big one and generally the courts will consider it fraud if you've had any property/asset changes (putting property in the name of another family member; joint holdings; etc.) within 6 months of the lawsuit being filed.

You can, however, include a judgment in a bankruptcy and it will go away. How that works is, the debt owed on the judgment goes away in your bankruptcy; but the judgment will _still_ remain in the state court (in paper only). You have to have your attorney file a pleading to have the judgment lifted (which will require a hearing) to make the "paper" judgment no longer show through your state court, or be reflected on your credit report, or showing as a lien on your property.

How the judgment is satisfied in a bankruptcy will depend on which chapter of bankruptcy you file. 

Also know that bankruptcy is not a state court matter. It is FEDERAL court and you will be signing your bankruptcy forms stating that, under Federal prosecution, you have not transferred any property, all the information is true and correct, bla-bla-bla. It is even MORE important to not make any changes in your assets situation prior to filing for bankruptcy (particularly if you have a judgment). 

Besides the state fraud laws, you also have Federal fraud laws to deal with; which are much more severe. You can go to jail for a LONG time messing with Federal laws.


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## Explorer (Dec 2, 2003)

Thank you, Karen.


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## magnolia2017 (Dec 5, 2005)

OK, I have a question that may apply to others as well. I live in a mortgaged home on land that is not in my name. The deed is in my late husband's name, and since he didn't have a will, I would have to first pay off the mortgage and then consult a lawyer to get a deed made. One lawyer I consulted suggested that I not worry with it unless I was planning to sell.

If a judgement was issued against me, can they touch the house or the land?

Maggie


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## Karen (Apr 17, 2002)

The problem I see is that you would actually own the property since you would be next of kin. If your name is on the mortgage and you've been making the payments since his death, the court would probably rule the asset belongs to you and would force you to acquire a deed to the property. 

Here's the problem I see with your situation in general. A person's assets no longer belong to them immediately upon their death. Any assets become an "estate". The estate is held in escrow until all outstanding bills have been paid from the estate. What is left, gets disbursed to the heirs.

If your husband owned property, you should have opened an estate upon his death. The estate would have transferred the deed, etc.

Of course, you cannot sell that property at any time without a deed, but the problem is, your heirs will end up with a disaster on their hands when you pass away; to say nothing of the entanglement of legal fees, etc. The more time that passes and the more layers of complications or people involved, the worst it becomes.

Now, if your name is not on the mortgage, you would not have any legal right to even be living on the property. The mortgage company could claim they would be the rightful owner of the property since no estate was opened (giving ownership to you).

You really should consult a probate attorney. A probate attorney is one who specializes in estate matters (which are enormously complicated and varying laws) to give you the correct advice and let you know where you stand. You should never trust probate advice from a general or real estate attorney. It is simply impossible to keep up with all the changes and for them to know all the laws of your state with regards to probate matters. There are so many variations and strange caselaws.


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## magnolia2017 (Dec 5, 2005)

Estate is settled and my name is on the mortgage. According to circuit clerk and lawyers I consulted, no deed can be made in my name unless I go through a lawyer. If my husband had a will and stated he wished the property to be mine, I wouldn't have a problem. Lawyers wanted $1000 up front several years ago and said that because there was an existing mortgage, it would cost more than it would if no mortgage existed. One actually told me that it would be easier and cheaper to get a "straw-party"(?) deed made and sell the property to a trusted family member for $1, and then buy it back for $1.

Maggie


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