Elderly Woman Faces Loss Of Mortgage-Free Home As Zombie Debt Scavenger Gets Lien On Premises; Failure To Update State Homestead Exemption The Problem

In New Orleans, Louisiana, WWL-TV Channel 4 reports:

• Imagine someone who has paid off their house and owns it outright, losing that home because of an old credit card debt. Unfortunately for Shirley Simmons, she doesn't have to imagine. It's a real fear she's been living with since the sheriff seized her home two months ago so it could be advertised and sold.

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• Simmons, a 78-year-old retired Jefferson Parish teacher, owes $15,000 on an old credit card bill. Now, a firm that bought that debt for pennies on the dollar (ie. "zombie debt") from the bank has gone to court to take away her home. “They’re having the sheriff sell her house on May 27 so that they can get their $15 thousand and put her out on the street, if need be,” said Simmons’ attorney, William Cherbonnier.

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• Attorney Cherbonnier said what makes this possible is Louisiana's homestead exemption from seizure and sale. [...] Right now Louisiana's homestead exemption from seizure and sale only protects $25,000 of a home's value. [...] Cherbonnier said people shouldn't lose their homes over debts like these, and they don't in a number of other states, including Florida and Texas. Both of those states protect the full value of a person's home.

For more, see Lawmakers want to stop credit card companies from seizing homes.

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