Q: I have an active court case from a creditor for an old debt. I am destitute and cannot pay it. What should I do?
Is it worth going bankrupt with my credit score still being decent? If they are granted the judgement, and I cannot pay, then what? I have no substantial assets other than a small IRA. My total cash is just a couple thousand and I own my car. I am self-employed and make little enough that I qualify for medicaid. Should I try to negotiate with the creditor? Not sure what the best path would be going forward.
A:
Maryland law offers exemptions from collection so that a modest amount of property can be exempt from a judgment creditor's reach. Note, however, that the exemption is not automatic and must be timely made/requested by the judgment debtor.
Someone facing collection has several options. The best options will vary with the particular circumstances, but may include negotiating with the creditor.
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