Can I Be Thrown in Jail For Not Paying My Creditors?

I find this to be a fairly common question among my clients. Collection agents frequently advise clients that if they do not pay their debts then they will have them thrown in jail. The practice of putting people in jail for not paying private debts was done away with in the 1800's. There are no longer Debtor Prisons in the United States. Don't be too happy though, because there just maybe a grain of truth to the creditors assertion that you could go to jail. How can you be sent to jail if it is illegal? Simple, disobey the court and be held in contempt.

Many people find it difficult to make their debt payments whether they be for credit cards, medical bills, home, or cars. If the situation becomes too difficult most people will only pay the things that are the most important. When this starts to happen creditors will start calling. After the creditor has tried to call, and still not received payment they will likely refer your case to a collection agency. Collection agents often tell all kinds of lies to people in the hopes of trying to collect payment for their debts. The most common threat is that the person could be thrown in jail.

After calling with no result, the collection agency might file a lawsuit. A lot of people who receive a lawsuit like to bury their heads in the sand and not respond. Many people even fail to attend the court date. This will result in a default judgment being entered against you. Even if you do not attend this hearing you still will not be thrown in jail. After the judgment is entered, the creditor will try to the have the court seize your assets in some way or another. If the creditor is unsuccessful they will then ask the court to make you appear with a list of your assets. This is known as an asset citation hearing.

This is where things become tricky. If you do not show up with a list of your assets at this meeting then you are directly defying a court order. The court will order that you are in contempt of court and issue a body attachment. Once this has been done you can be arrested until you comply with the court order and provide a list of your assets. If you think you are in danger of having a lawsuit filed against you and cannot pay the debt speak to an experienced bankruptcy attorney immediately.

If you have questions regarding bankruptcy in Indiana please contact Jackson & Oglesby Law at (877) 489-0908 or visit us at www.IndyBankruptcyLaw.com. Jackson & Oglesby Law can assist you with all aspects of your bankruptcy case. If you have questions regarding Chapter 7 bankruptcy, Chapter 13 bankruptcy, stopping foreclosure or wage garnishment, avoiding liens, stopping law suits, discharging debt, etc. we can help! Please call us today for your free phone consultation to determine which bankruptcy may be right for you.