It’s a common misconception that you can be arrested and sent to jail simply for owing debts. Being sent to jail for debt is a popular myth. It’s illegal in the United States for debt collectors to threaten arrest to collect payment. That being said, some debts can lead to criminal prosecution, especially if they are fraudulent in nature. Also, you cannot simply ignore court hearings without consequences. Therefore, it is essential to understand how the law works when it comes to owing money. It is possible to end up in jail for reasons at least related to debts on some rare occasions!
The Fair Debt Collection Practices Act is a federal law that prohibits debt collectors from using abusive, unfair, or deceptive practices when attempting to collect a debt from a consumer. Debt collectors cannot threaten violence, use obscene language, misrepresent themselves or use false statements when trying to collect payment from a debtor. They also cannot threaten arrest or imprisonment to collect debt from an individual. Have you experienced any of these tactics being used by a debt collector? In that case, you should report them immediately if they are severe. Also, seek legal advice, if necessary, from a bankruptcy or debtor attorney.
You cannot be sent to jail simply for owing debts. You also cannot be criminally charged simply for owing debts.
In some cases, unpaid debts can result in a criminal prosecution—but only under certain circumstances. For example, if you write bad checks with the intent to defraud someone out of their money, you may be charged with fraud or theft in addition to owing the money itself. Additionally, suppose you fail to pay court-ordered child support payments. In that case, you can be held in contempt of court and face jail time as punishment. In short, the only time you can go to jail over an unpaid debt is if the debt has created a valid criminal charge that has been filed against you. Remember that this can also apply to nonpayment of court-ordered obligations such as child support payments. However, with child support, the amount of nonpayment usually needs to be very large before criminal prosecution takes place.
If you ignore court hearings, you could also find yourself temporarily held in jail for something related to your debts. Although you cannot go to jail for debts, you can be held in jail for a short time for ignoring court hearings. A local police officer could see you have a warrant to appear in court. They could arrest you and drive you directly to the court or put you in jail until the court opens. This could be very inconvenient if you are arrested on Friday evening. You would have to wait in jail all weekend, potentially until the court opens on Monday!
Although this scenario is extremely rare, ignoring court hearings is still a bad idea. If you have an order to appear in court, make sure that you appear in court. Also, if you have missed a hearing, go to the main clerk’s office or contact the judge’s clerk to see if you can fix the error. If you are filing for bankruptcy, pay your fees and get your documents together to file your case. After your bankruptcy case is filed, all lawsuits or hearings are eventually canceled.
Suppose a creditor or collections agency cannot collect your unpaid debts through standard means (phone calls and letters). In that case, they may sue you in civil court to recover the debt. Suppose the creditor wins the case against you in court. In that case, they will be awarded a judgment. The judgment can require you to pay back the amount owed and any interest accrued over time. If the debtor takes neither option, wage garnishment may come into play. A wage garnishment means that part of your wages will automatically be withheld from your paycheck by your employer and sent directly toward your debt.
Debts cannot usually send individuals to jail. It is common for an unpaid debt to end in wage garnishment. Other times, the creditor may also attempt to garnish your bank account. You must act immediately if you have a lawsuit against you for debt. Bankruptcy can stop a lawsuit. Bankruptcy can also stop wage garnishment.
Contact a bankruptcy attorney immediately if you have a lawsuit for a debt or a wage garnishment. A bankruptcy attorney can stop the lawsuit and wage garnishment.