If I understand Mr. Yet, 42 USC 407(a) prohibits garnishment of SSI disability for credit card debt. What is the best way to address a credit card company threatening arbitration and eventual court order for garnishment in this circumstance?

My 40-year-old brother-in-law is permanently disabled due to his schizophrenia. His only source of income is his SSI disability. He makes a monthly student loan payment but is unable to pay anything on his credit card debt. The credit card debt is too high for him to make any significant payment even on the interest. (Most of the debt occurred when he was unmedicated and manic.) He is being threatened with arbitration with the intent of seeking a court order for garnishment.

Are there any steps he should take to protect his disability payments or to prevent further threats from the credit card debt holder? (I worry the stress will cause him to relapse.)

Is there any official government publication or court decision that we can consider / cite that teases out the meaning of 42 USC 407?

Your brother has a defense to the claim for payment: lack of capacity to contract. You might use this if he is sued. If you can get medical records, you may be able to persuade the lender of this condition and avoid the suit before it is filed. A lot of lenders and collectors love to make threats and there isn't much you can do other than have the conversations recorded, provided it is legal.

Make a copy of 42 USC 407(a) prohibits garnishment of SSI disability for credit card debt and send it the credit card company, they maybe more helpful after that, once they know you know what the law states. Sent it certified mail with return receipt, never speak to them on the phone, only in writing.

Read some of the many posts in here about Social Security and other funds that are exempt from garnishment. I agree with Mr. Yet about contacting the CC company. Before arbitration or possibly court, your brother needs to write a letter as soon as possible to the credit card company stating that the only income he receives is from Social Security and cite the law as Mr. Yet provided. Remind them that garnishment from Social Security is a violation of Federal and possibly your state laws. Send it certified return receipt. Keep extra copies as you will need one if it goes further.

So, if it goes to arbitration or court, get further documentation to attach to your letter. If he has an electronic deposit in a bank, print out a statement from the bank if it reflects only an SSI deposit and attach it to your garnishment letter (black out account numbers, private info, etc.) He shouldn't have any other funds deposited in that account. If he has paper checks, he probably has letters from Social Security showing his benefits or go to the local Social Security office and they will verify in writing that he is a recipient of SSI funds (black out private info). He will just need proof to support his cause if it goes further.

One last suggestion is to check your state laws regarding garnishment. Most states have a garnishment exemption form that can be filed in court. Although your brother's case may not go that far, the form is a good sample to start with. Good luck and best wishes.