Can you be arrested over debt?
Image source: Flickr user Chris Yarzab
Debt collectors can employ some pretty scary and nasty tactics. One of the most common is to threaten you with actions they're not actually able to take. This includes threats of arrests, warrants and jail time. As a rule, you cannot go to jail for not paying a regular old everyday bill. If you have unpaid court fines or are behind on your alimony or child support, you can face a warrant.
We've had clients tell us about terrible debt collections tactics that have been tried on them. One pregnant woman was told by a collector for a major credit card company that she would be jailed if she couldn't pay her past due bill and would have her baby behind bars. This is a terrible extreme, but it absolutely does happen. Fear is a powerful motivator that many debt collectors will employ.
Step 1 - Don't panic
But the worst thing you can do is to panic and cave in to unreasonable demands. If you get a call threatening criminal charges, ask for a callback number, details of the debt and then end the call. If they fail to provide the information and just want to make threats, end the call because they're very likely lying and operating in violation of the Fair Debt Collections Practice Act (FDCPA).
Step 2 – Know what creditors can and can't do
In North Carolina, creditors cannot garnish your wages. Only governmental institutions can garnish and only for things like taxes or unpaid support obligations. However, a creditor can go after your bank account or try to put a lien on your home or auto. They also cannot go and swear out a warrant for your arrest. They aren't supposed to threaten or curse at you, but sometimes they will. Just file this under “sticks and stones may break my bones, but words can never hurt me” unless it escalates.
Step 3 – Never ignore a court notice
How creditors can get you is to send you a court notification and you ignore it. If you get notice that you're being sued, you may be scared to go to court if you can't afford it. But you shouldn't ignore it. Go to court and tell the judge that you're sorry but you can't afford it. There's a chance the judge can deem that you're uncollectible at this time and not let the judgment go through.
Once a judgment has been issued, you may get a notice for a debtor's examination. This is when you are called in to answer questions about your income and assets. Also don't ignore these notices. You should always show up and tell the truth. If you fail to show up, you may be slapped with a failure to appear notice or warrant. This is one of the rare paths between debt and jail.
Step 4 – Consider bankruptcy as a solution
Once a creditor obtains a judgment or lien, it will usually follow you for up to a decade and can haunt you. But, in most cases, these can be wiped out in bankruptcy unless they are associated with student loans, taxes or support obligations. Typically, for a debt that would itself be dischargeable in bankruptcy, the resulting judgment or lien may also be dischargeable. To find out more about getting relief from your debts, contact the law offices of John T Orcutt for a free consultation on how North Carolina bankruptcy can help you get a fresh start.