By itself, failure to pay your bills is not a crime in the United States. Though the term is freely bandied about today, Bankruptcy Jail, or Debtor’s Prison, has not existed since the mid-1800s. While there are some circumstances that could land you in the pokey, the average debtor who can’t pay the credit cards is highly unlikely to wind up there.
What are the circumstances that might cause a debtor to be imprisoned? Well, that varies from state to state but can include failure to pay child support (if one can afford to) and failure to pay other court-imposed costs. Other things that could cause you to go to jail for debt are ignoring court orders and unpaid debt incurred through fraudulent or other criminal actions. In California, one may be imprisoned to pay down court-imposed costs under certain programs.
An unethical, and illegal, tactic that collection agencies often employ is to threaten debtors with imminent arrest and jail. Where fraud or other criminal activity is absent, this is not going to happen. A policeman is not going to show up on your doorstep, but if a creditor decides to sue you, someone with a summons in hand will.
Even though you are unlikely to go to jail for not paying your bills, being buried in debt is its own form of prison, and ignoring your situation won’t do anything to make it better. In fact, burying your head in the financial sand can actually make it worse.
The best thing you can do when overwhelmed by debt, whether you file bankruptcy or not, is to speak with a bankruptcy lawyer. Many give free consultations where you will be able to get a better handle on your situation. If you’re not sure how to shop for a lawyer, check out what I learned about choosing a bankruptcyattorney.
So, does bankruptcy jail exist? No. Can you go to jail for debt? Highly unlikely, but it’s remotely possible. Talk to an attorney to know for sure.
Good luck with your fresh start,