Monday, November 26, 2018

Can Credit Card Debt Send You to Jail?

Many Americans own at least one credit card. They are convenient when it comes to paying for large purchases or buying things online, which has become increasingly common. Some restaurants even no longer accept cash payment. However, it is this “convenience” that often causes many individuals to find themselves in credit card debt.

The Federal Fair Debt Collection Practices Act

Under the federal Fair Debt Collection Practices Act, debt collectors are prohibited from conducting any abusive or harassing behavior; that includes the threat of going to jail. If you are being harassed by a debt collector, you can report it to the Consumer Financial Protection Bureau.

While debt collectors cannot arrest you for having credit card debt, they can take you to court and sue you for payment. In the state of Ohio, you have 28 days to respond to a complaint by your creditors. Should you fail to file an answer, if you overlook a legal summons and complaint, or do not show up in court at the proper time, your creditor can win by default, therefore receiving a judgment against you.

Garnishment of Wages

If you do not think you have the money to pay the judgment, think again. Courts can order garnishment of your wages and permit creditors to seize personal property and put a lien on your real estate. The exception does exist for a certain value of your residence, medical debts, and enforces a limit for personal property and vehicles.

Mandated Court Appearances

If your creditors are still unable to secure the money from you, courts can order that you appear in court and answer questions under oath regarding your finances and your reasoning for not having paid. Should you fail to attend, the court can then find you in civil contempt. If you fail to pay or follow the court’s orders, it may find you in contempt of court and issue a warrant for failure to obey a court order.

The only reasons that you could potentially be sent to jail related to credit card debt is if you have committed theft, fraud, or as mentioned, have defied a court order.

What Can You Do?

Should you be continuously contacted by an aggressive debt collector, there are certain things that you can to avoid these aggressive collection efforts. They include:

  1. Make sure to read and respond to all of the papers that you receive from both the court and the collector’s attorney.
  2. Show up for hearings.
  3. Know Whether You Are Judgment-Proof
  4. Ask for a hearing
  5. File for Bankruptcy

If you or a loved one should find yourself swimming in debt, seeking an experienced bankruptcy attorney is often a wise choice. At Miami Valley Bankruptcy, we help our clients with their debt by evaluating their situation and helping them to create a plan that not only works to remove you from being in debt, but also helps to protect against aggressive collectors. It is important to do so in a timely manner, as waiting to take care of it can often make your situation worse.

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