Do You Qualify?If your only income is from unemployment compensation or worker’s compensation benefits, you qualify for the AAUD program. Your creditors are prohibited from garnishing or attempting to garnish this income. Thus, you are judgment proof and there is no reason for the creditors to be harassing you.
If the debtor has significant equity in his/her home, which may be subject to a lien and foreclosure by a creditor, in some cases, the debtor may be eligible for exemption because of the state’s homestead exemptions. The state homestead laws prevent jeopardizing the ownership of a home if the homestead exemption is more than the amount of the loan. Homestead exemptions vary among the states (i.e., California, $125,000; Illinois, 15,000).