MILITARY RETIREMENT PAY GARNISHMENT

Everybody's Uncle,

If you are no longer able to make payments on a motorhome and can't sell it because you owe more than it is worth, can a finance company garnish your military and civil service retirement pay to collect any balance due if it is repo'd?
 
Thanks,
 
Roberta

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Dear Roberta,

Ordinarily, ability to pay does not change indebtedness - debt owed is debt owed.

To the best of my knowledge and some research, neither military nor civil service retirement pay is exempt from garnishment.

However, negotiation to settle a negative equity situation might prove effective. You might be able to extend payments over a longer period of time or get a lower interest rate. If funds are available to you from other sources, you might be able to negotiate an agreed lower payoff fee.

Bankruptcy (or the threat of) is a negotiating point even if not appropriate in the bigger picture. If you get some debt relief you might find it taxable as income. That too can be negotiated.

Uncle Jim can only give friendly advice. Professional advice is desirable when employing tactics to avoid payment.
Everybody's Uncle