Can I Go To Jail For Not Paying My Debts?

Can I Go To Jail For Not Paying My Debts?

In Hollywood there may be such a thing as “debtor’s prison”, but that is really more for theatrical effect than to portray how debt collection works in the real world. If you are not able to pay your bills, you may be worried about what your lenders can do to you. One of those worries might include wondering whether you will have to go to jail, which is not something anyone wants to do. And while there is technically no such thing as a “debtor’s jail”, there are some things you need to know about debt collection and how it can impact your life.

How To Handle A Collections Lawsuit or Judgment Against Your Debtsdebts can alter your life

If you are sued for a past due debt and do not answer that lawsuit, the lender will probably have a default judgment entered against you. In many cases, simply filing a “General Denial” answer will allow you the time to find a solution to your debt problems. However, once a judgment is in place, the creditor will start collection efforts. That can include garnishing your wages, seizing bank accounts or other unprotected assets.

The creditor can even have a Judge order you to appear and provide details about your assets. If you fail to show up to a hearing, the Court has the authority to have you held in contempt, not for failing to pay the debt but failing to follow the Court’s order to appear. That can be a contempt citation and an arrest warrant. However, you will have chance to purge yourself of the contempt and avoid these harsh consequences. This is not really a “debtor’s prison,” because the warrant is tied to the failure to show up in Court instead of the actual debt.

Filing Bankruptcy Will Help You Avoid Court Orders on Your Debts You Cannot Live With

If this all sounds like too much, the best course of action for you is to find out if you qualify to file for bankruptcy. When you file a case, you get these immediate benefits:

  • An immediate stop to any collection activities against you. That includes stopping lawsuits; foreclosure; repossession of your vehicles; and those abusive phone calls trying to collect debts on credit cards, medical bills and personal loans.
  • It even stops all actions to collect taxes. In some cases, it can even wipe out tax debts.
  • All communication from lenders to collect their debts has to stop.
  • You no longer have to make the payments on the debts you are able to discharge in bankruptcy.
  • Your income can now be used for yourself and those you may support for those luxuries like food, housing, utilities and the list goes on.
  • Stopping those payments is the equivalent to having your take home pay increased, except you don’t have to pay additional income taxes on that increase.

For answers to your questions about how debt can be managed when debts are spiraling out of control, call my office at (916) 485-5444 to schedule a real consultation with a skilled bankruptcy attorney. I have helped thousands of other people get out debt, and I bet I can help you too.

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