Threatening debtors with jail is against the law!
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Unscrupulous debt collectors may threaten past-due Wilmington consumers with jail. If you’ve ever been terrorized in this way by a collection agent, you should know that they can not send you to jail and they shouldn’t be making those threats. Being in debt, even if you’re very overdue, is not a crime. However, some debt issues are criminal.
If you commit fraud by taking on debt that you don’t intend to pay or in someone else’s name, that can land you in prison. Also, writing bad checks, tax evasion, or not paying child support can result in an arrest. But regarding standard debt that you can’t afford to pay, there’s nothing criminal about it - it’s just unfortunate and frustrating.
At One Time, Debtors Were Jailed!
Up until the mid-19th century, those who fell behind on their debts could end up in debtor’s prison. The tradition of imprisoning people over debt carried over from England to the British colonies in America. Debtors stayed incarcerated until their debt was paid in full.
While in jail, the debtor also paid for his upkeep, so debt could grow while they were incarcerated, and many died in prison. These prisons were prevalent in America until the mid-1800s. About two centuries ago, the United States formally abolished jailing people for unpaid debts.
Are Jail Threats Illegal?
When creditors threaten you with jail time, they are not only bluffing, but they are also breaking the law. Threatening a debtor with imprisonment is against the Fair Debt Collection Practices Act. Yes, you can be sued over unpaid debt, but it’s civil court, not criminal.
The creditor or debt collector can file a lawsuit in Wilmington to try and collect the debt. If they win, they will get a judgment from the court that could allow them to place a lien on your assets. But no matter how the court rules, jail time is not on the table.
File A Complaint If You’re Threatened
The Federal Trade Commission (FTC) enforces the Fair Debt Collection Practices Act (FDCPA). If a debt collector threatens you with imprisonment, you can report them to the North Carolina Department of Justice, the FTC, and the Consumer Financial Protection Bureau (CFPB).
The direct link to report inappropriate behavior by a debt collector is ftc.gov/complaint. There’s an FTC Complaint Assistant icon to click, and it guides you through the process to report the abusive debt collector. You should turn in any collector that threatens you to halt their abusive behavior.
Stop Debt Collections With Bankruptcy
Do you dread opening your mail or answering your phone because it’s nothing but past-due notices and demands for payment? When you’re living paycheck to paycheck and must choose which bills to pay or skip, you have no peace of mind or quality of life.
One option to consider is Wilmington bankruptcy. You can choose between Chapter 7 and Chapter 13 to deal with unmanageable debt. Chapter 7 takes care of most types of unsecured debt in just a few months and can give you a rapid fresh start.
With Chapter 13, you get a repayment plan to catch up past-due secured debt (mortgage and auto loans) and reduce balances on unsecured debt as well. Meet with a North Carolina bankruptcy attorney about your unique financial circumstances to see which is best for you.
The first step to a brighter future is to talk to a reputable local lawyer about your debt relief options. Read reviews from our clients, then contact the Law Offices of John T. Orcutt. Call +1-919-646-2654 now for a free Wilmington bankruptcy consultation at one of our locations in Raleigh, Durham, Fayetteville, Wilson, Greensboro, Garner or Wilmington.