Anyone who has read Charles Dickens' novels knows that at certain times in history you could be sent to jail for failure to pay a debt. Modern law, especially in the United States, does not actually allow you to be sent to jail for failing to pay a debt. As with any law there are certain exceptions to the rule, so learn how debt can land, you in jail.
Criminal or Civil
Often, people believe they can get sent to jail for a wide variety of things not actually criminal offenses. Only upon violating a criminal law can you be sent to jail. Civil matters, such as breach of contract or personal injury claims, do not carry a threat of jail. Only monetary damages can be awarded.
No Jail for Debt
Debt collection is a matter for civil law which means the only remedy is monetary damages. The company can get a judgment against you and garnish your wages, but as it is not a criminal conviction you will not be sent to jail.
It Depends on the Debt
Failure to pay certain debts is a criminal offense. Failing to pay a mortgage or credit card debt is purely civil. There are exceptions to every rule however, and debt payment is no different. Failing to pay court fines, court-ordered child support or your taxes is a criminal offense however, and failure to pay those can land you in jail.
Contempt of Court
Even in civil matters--such as debt collection--the court can send you to jail for contempt for failing to observe appropriate courtroom behavior or failing to make your court dates. In this situation however, you are not being sent to jail for failing to pay your debt. You are being sent to jail for committing a criminal offense against the court.
Not being sent to jail does not mean that failing to pay your debt does not have actual consequences. Your credit will be ruined, the creditor can garnish your wages and tax returns and you may ultimately be forced to file bankruptcy.
- Photo Credit London Debtor's Prison. Photo: Russell Kenny/Commons.wikimedia.org Creative Commons License
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