Posted on: 18th Apr, 2011 08:17 pm
I subscribe to Clark Howard's weekly newsletter, and received one this morning that has alarming information in it.
Howard has long held that debtors cannot be jailed for failing to repay debts, as have I. However, in his newsletter today, linked to an article on his website, he states that The Wall Street Journal reports that a third of the states in the US are now allowing debtors to be jailed for precisely that - non-payment of debt.
The laws of each state are different, as he points out; so check with your state Attorney General or, perhaps, Consumer Affairs Office, for clarification if you are concerned about your individual situation.
Howard advises two specific things to do if you need to protect yourself from this heinous excess:
First, if you're sued and served with legal papers, it is imperative that you show up in court; and if a collector contacts you by phone or in writing, you need to follow up by sending them mail by certified mail (return receipt requested;
Second, as for a defense...if you're accused and you know the debt isn't your own, make them prove it; if it is your own debt, and it's past the statute of limitations for your state, you can tell them that the note you signed is not longer legally enforceable.
In other words, Watch out!
Howard has long held that debtors cannot be jailed for failing to repay debts, as have I. However, in his newsletter today, linked to an article on his website, he states that The Wall Street Journal reports that a third of the states in the US are now allowing debtors to be jailed for precisely that - non-payment of debt.
The laws of each state are different, as he points out; so check with your state Attorney General or, perhaps, Consumer Affairs Office, for clarification if you are concerned about your individual situation.
Howard advises two specific things to do if you need to protect yourself from this heinous excess:
First, if you're sued and served with legal papers, it is imperative that you show up in court; and if a collector contacts you by phone or in writing, you need to follow up by sending them mail by certified mail (return receipt requested;
Second, as for a defense...if you're accused and you know the debt isn't your own, make them prove it; if it is your own debt, and it's past the statute of limitations for your state, you can tell them that the note you signed is not longer legally enforceable.
In other words, Watch out!
Thanks for sharing this, George!
It seems quite ridiculous that a debtor would get arrested if he or she is unable to pay the debts. To not pay debts due to financial hardship can't be considered as a criminal offence. But again as you said replying to the summons and attending the court proceedings will definitely help the debtor in avoiding such circumstances.
It seems quite ridiculous that a debtor would get arrested if he or she is unable to pay the debts. To not pay debts due to financial hardship can't be considered as a criminal offence. But again as you said replying to the summons and attending the court proceedings will definitely help the debtor in avoiding such circumstances.
Hi George!
Do you exactly know which are those three states which have implemented these types of punishments?Anyway, It will make all the homeowners more serious towards paying the debt.
DIPA
Do you exactly know which are those three states which have implemented these types of punishments?Anyway, It will make all the homeowners more serious towards paying the debt.
DIPA
Dipa, it's one-third of the states in the country (50/3 = 16.67). Obviously there cannot be two-thirds of a state enforcing a law while the other third doesn't, but I imagine we'd round it up to 17 states.
Among the states are Arizona, Florida, Illinois, Indiana, Oklahoma, Utah, Washington. No others were named specifically, and there is an indication that many of those not listed don't have enough specificity in the filing of lawsuits to determine whether the jail terms are for debts owed.
Clark Howard was quoting from a Wall Street Journal article.
Among the states are Arizona, Florida, Illinois, Indiana, Oklahoma, Utah, Washington. No others were named specifically, and there is an indication that many of those not listed don't have enough specificity in the filing of lawsuits to determine whether the jail terms are for debts owed.
Clark Howard was quoting from a Wall Street Journal article.
Sorry, I disagree. I believe if more people were "punished" for not paying their debts we would not have near the economic problems we currently have.
I was taught, when you finance something your giving your "word" to repay. Personally, My word is one of the most important things I have. I would rather have my bills marked "Paid" and empty checkbook than to brag about how, on a technicality, I "got over" on some bill or have collections companies calling me all the time.
If more states were to have these types of laws, Just as dipaligopale stated "It will make all the homeowners more serious towards paying the debt."
That's just my take on that topic.
I was taught, when you finance something your giving your "word" to repay. Personally, My word is one of the most important things I have. I would rather have my bills marked "Paid" and empty checkbook than to brag about how, on a technicality, I "got over" on some bill or have collections companies calling me all the time.
If more states were to have these types of laws, Just as dipaligopale stated "It will make all the homeowners more serious towards paying the debt."
That's just my take on that topic.
Hi house shopper,
I agree with you on the subject matter of 'keeping the word'.There is very nice quote related to the 'keeping word'.
'If you want to be successful in your life then there are only two things which you should do
1. you should keep all the words you have given.
2.If you think you are unable to accomplish the task you should never give a word to anybody.
If someone follows these simple rules then I do not find any reason to have all those sophisticated laws to punish anybody...and all the related paraphernalia associated with it...Just make it simple by keeping your word.....
Feel free to ask any further query if you have....
DIPA
I agree with you on the subject matter of 'keeping the word'.There is very nice quote related to the 'keeping word'.
'If you want to be successful in your life then there are only two things which you should do
1. you should keep all the words you have given.
2.If you think you are unable to accomplish the task you should never give a word to anybody.
If someone follows these simple rules then I do not find any reason to have all those sophisticated laws to punish anybody...and all the related paraphernalia associated with it...Just make it simple by keeping your word.....
Feel free to ask any further query if you have....
DIPA
We can respectfully disagree on the rationale behind "debtors' prisons." Please don't forget that debtors includes people who don't own real estate also, which you'd cited, shopper.
If someone fails to pay a debt, it is not always due to a desire to "get over" on a creditor. Yes, there's that segment of the population that tries to get away with things all the time, but I'll aver that the vast majority of defaults result from circumstances and not willfulness.
If someone fails to pay a debt, it is not always due to a desire to "get over" on a creditor. Yes, there's that segment of the population that tries to get away with things all the time, but I'll aver that the vast majority of defaults result from circumstances and not willfulness.
Thank you George for sharing this. I am currently going through an ordeal it seems they plan to take me to court in the state of Washington over a payday loan I took out back in 2005 they said they are going after me for fraud. I didn't close my checking account on purpose we moved to WA, from AZ and my account was in the red before I got here, and no job I forgot about the debt, and now wahlah in the SOL it says 6 years any advice? Thanks
Hi Missy,
Your query has been replied to in the given page:
http://www.mortgagefit.com/credit-rating/about52758.html
Take a look at it. I hope it will help you.
Thanks
Your query has been replied to in the given page:
http://www.mortgagefit.com/credit-rating/about52758.html
Take a look at it. I hope it will help you.
Thanks
We do not have debtors' prisons in this country. A crime has to have a criminal intent at the time the crime is committed. If you intended to pay back the debt at the time of the contract, there would be no crime. There are exceptions for fraud, etc.
I have not read the WSJ article, but there is no crime in the US for non-payment of a debt. The article must refer to something related, for instance, having a judgment against you and not appearing for a deposition, or disobeying an order of the court so you are in contempt of court.
I have not read the WSJ article, but there is no crime in the US for non-payment of a debt. The article must refer to something related, for instance, having a judgment against you and not appearing for a deposition, or disobeying an order of the court so you are in contempt of court.
