Recently I spoke with Penny, age 65, who shared her story. “My only income now is $962 in Social Security. My father, who was always there for me, passed away. Two months later, my 30-year-long companion who had cancer died. Collectors were calling me when I was with him in the intensive care unit. My world had fallen all apart. I had a school loan for my daughter, and I owed the IRS. Then there were the other creditors I owed. I never dreamed in a million years I would be in this position. When the creditors called, they threatened and I thought I had to pay. There went my food money. I was scared and I didn’t know what to do.”

The Kaiser Family Foundation recently reported that 38 percent of Oklahoma seniors – people over age 65, approximately 220,000 persons – have incomes within 200 percent of the poverty line.1Even more concerning, more than one in 10 Oklahoma seniors, seniors like Penny, have incomes under the poverty line, based on supplemental poverty measures.2

Several studies show that debt owed by seniors has risen dramatically in the last 15 years. The federal Consumer Financial Protection Bureau recently released a report declaring abusive debt collection as the top complaint for older Americans.3
Most legal help today is oriented toward seniors with money. Low-income seniors with little or no money to pay for advice or help often have difficulty finding answers to their financial questions. After nearly 40 years of practice, I have learned that attorneys want to help this segment of the population, which can be among the most helpless in our society. It is not uncommon for attorneys in different areas of practice to be contacted by a senior searching for answers – answers and assistance, as I will explain, that are often very easy to provide. If turned away, these seniors may never be able to find the help they need. Attorneys in private practice willing to answer questions for a few minutes on the phone can be a blessing to low-income elderly.

PROTECTION FROM COLLECTORS
I am the executive director of HELPS (Help Eliminate Legal Problems for Seniors and Disabled), a nationwide 501(c)(3) nonprofit law firm that protects seniors from unwanted collector contact and educates seniors about maintaining their financial independence. I have learned that the vast majority of seniors do not understand one very important fact: Social Security, pensions, retirement, VA benefits and disability income are all protected from collection under federal law. They cannot be garnished or seized. However, if seniors don’t pay their old debt, collectors can make their lives miserable, and most seniors don’t realize they also have the right to be protected from unwanted collector contact.

One way attorneys can help is to tell seniors about the federal Fair Debt Collection Practices Act (FDCPA).4 This act provides that when a debtor sends a cease and desist letter in writing, a collector must stop all communication by mail or phone. The law can be explained and a template provided to a senior. These templates are found on the internet, or at our website www.helpsishere.org.

It is our experience that when a cease and desist letter is sent, it is normally the end of the matter. However, even when this law is explained and a template provided, seniors may be unable to prepare or send the letter. Legal matters are confusing and intimidating to many seniors, and they have a very difficult time dealing with collectors on their own. Because of this, there is another way attorneys can help further. FDCPA also provides that if a person is represented by an attorney, a collector may no longer communicate with that person, only with the attorney. HELPS represents low-income seniors and disabled persons nationwide in order to receive collector communication on an ongoing basis. We never turn any senior away who needs our help, but we are not large enough to assist every senior. We encourage all attorneys to provide seniors who are in need with a cease and desist letter. Perhaps, like HELPS, the attorney can send the letter for the senior, or even offer to represent the senior simply to receive these communications from collectors on an ongoing basis. This is a simple service that will bring peace back to their lives.

BANK ACCOUNT PROTECTION
There is other helpful information for attorneys to know when counseling low-income seniors. Seniors often worry about the money in their bank account, so they can be informed that federal banking regulations automatically protect all monies in an account into which Social Security is deposited, equal to twice the amount of monthly Social Security, no matter the source of the money in that account at the time of a garnishment. Any garnishment must be disregarded. If the account has excess money that is garnished, a claim of exemption can be filed to have that money returned.

The internet is full of debt settlement companies that advertise helping people to either settle or pay old debt. I have yet to talk with a senior enrolled with a debt settlement company who was ever told, “By the way, you don’t need to pay us anything because all your income is protected by law.” I often talk with seniors with minimal income who go into utter poverty to make a payment to one of these companies for old debt they cannot afford and do not need to pay.

TAXES AND OTHER DEBT
Some seniors are garnished 15 percent of their Social Security for past due IRS taxes. Low-income seniors almost always qualify for tax-exempt status. Attorneys in private practice can advise seniors with this problem to contact the IRS. Also, Social Security and retirement income are protected from garnishment for past-due state income taxes. Additionally, some seniors are being garnished 15 percent of their Social Security for old student loans, but low-income seniors usually qualify for $0 per-month payments under the income contingent repayment plan and private student loans cannot garnish Social Security or other retirement income. HELPS will email any attorney instruction sheets on obtaining IRS “currently not collectible” status and income contingent repayment procedures.5

Attorneys can also provide other common-sense advice. Seniors sometimes spend protected retirement on old debt, leaving them without income cushion. Many do not know they can stop payments for purchases they simply cannot afford. For example, seniors can be advised about the option of stopping a mortgage payment they cannot afford, selling the home or living in the home while it is going through foreclosure. Many seniors don’t know about the availability of Section 8 subsidized housing or, if there is enough equity in the home, that a reverse mortgage can pay off an existing mortgage, allowing the senior to stay in a home they otherwise could no longer afford.

Some seniors are worried about difficulty renting in the future because of poor credit. Landlords typically do not know that a senior’s Social Security and retirement income are safe and protected. An attorney can write a simple informational letter addressed to “prospective landlord” that explains how the law protects the senior’s Social Security and retirement income, so the income will therefore be available to pay rent and provide for their needs, no matter what their credit looks like. HELPS provides these letters for any senior and we have found this often solves concerns for most landlords who are worried about a senior’s poor credit.

TOGETHER WE CAN HELP
Certainly seniors want to pay their debt, but some simply are not able. There is a reason laws protect seniors’ income, we want seniors to be able to provide for their needs. According to the United Health Foundation, almost one out of every six Oklahoma seniors over 60 faced the threat of hunger in 2016.6 Oklahoma attorneys can help seniors understand their rights, especially that their income is protected. If attorneys are unable to help, HELPS is always available to seniors and disabled persons to provide the assistance mentioned above. Together, with the help of Oklahoma attorneys, fewer seniors will face hunger and more will have peace return to their lives.

ABOUT THE AUTHOR
Eric W. Olsen graduated from the University of Oregon School of Law in 1978 and was the founder of the consumer bankruptcy firm OlsenDaines. Mr. Olsen is executive director of HELPS, a nonprofit law firm he founded following the 2008 recession. HELPS assists low-income seniors and disabled persons by protecting them from collector harassment and teaching them how to maintain their financial independence.

1. Kaiser Family Foundation analysis of 2012, 2013 and 2014 Current Population Survey: Annual Social and Economic Supplement.
2. Kaiser Family Foundation estimates based on the Census Bureau’s March 2016 Current Population Survey Annual Social and Economic Supplements.
3. Consumer Financial Protection Bureau, Office for Older Americans, 2014 Snapshot of Older Complaints Submitted by Older Consumers.
4. Fair Debt Collection Practices Act (FDCPA), U.S.C. §1692 et seq.
5. www.helpsishere.org/resource.
6. National Foundation to End Senior Hunger, The State of Senior Hunger in America, 2016 Report.

Originally published in the Oklahoma Bar Journal -- OBJ 88 pg. 1735 (Sept. 9, 2017)