Until a collection agency sues you and wins they can’t legally take anything you own to pay off your debts. However, once the agency sues you and wins, they obtain a “judgment” against you they can take your “nonexempt” property to collect against your debt. What is nonexempt property?

• Personal savings (bank accounts, stocks and/or bonds, CDs, money-market funds)
• Valuable collections
• Vacation or investment properties

Possessions that are considered exempt, meaning that a creditor is not allowed to sell these items to satisfy your debt, are:

• Your house
• Your retirement savings accounts (i.e. 401(k)s, some qualified IRAs)
• Up to $30,000 of an individual’s property or $60,000 for a family
• Social Security income
• Disability income
• Unemployment income
• Welfare
• Alimony and child support
• Your car
• Clothes
• Furniture
• Personal belongings (i.e. mementos, jewelry)

If a collection agency wins their case and gets a judgment against you, they can also create a “lien” on your property. A lien means that the agency can force the sale of your property (with the exception of your home). If a judge issues a "turn-over order” that means that the court orders you to turn over nonexempt property to your creditor.