Why You Should Beware of Debtors' Prison
Debtors' prisons were abolished in the United States in the 19th century. I surprised myself when I remembered that fact as I read a recent headline from the Minneapolis-St.Paul Star Tribune, "In Jail for Being in Debt." Immediately, I conjured an image of a shivering woman crouched in the corner of a jail cell, sharing a meal of gruel with rats. Suddenly, $39 late fees and annoying calls at dinner didn't seem all that bad.
Only days later, MoneyWatch Consumer Reporter Marlys Harris wrote a related the story about Mr. Button in Southern Indiana. Seems that one Herman Button owes $1,800 to a former landlord and has no means to pay up. The judge threatened jail time for Button if he did not come up with $25 each month to pay down the debt. In that case, the Indiana court of appeals reversed the order on the grounds that it violates the state's constitution. Even so, in Indiana a creditor can petition a court to issue a summons for non-payment of a bill. If the debtor fails to appear, then she's in contempt of court and all bets are off. Jail time becomes a definite possibility.
Should you be worried about getting hauled off to the pokie because you're behind on payments or you've defaulted on a credit-card balance? Apparently you should. Any creditor can file a lawsuit for non-payment. If you do not respond and show up to defend yourself in court, you could lose by default. If the court is in a particularly nasty mood that day, it could issue an order for your arrest plus a legal judgment against you.
Even if you are simply issued a judgment, you still have cause for concern. The plaintiff can use any legal means available to collect that judgment including garnishing your wages, filing a lien against your property, tapping your bank account and so on. Laws vary by state, but none of the potential consequences are pleasant.
While the odds of you going to jail for non-payment of your debts are probably slim, it does occur to me that any time we carry debt we have created our own kind of debtor's prison. Whenever there is a debt incurred, the borrower becomes a slave to the lender. Sounds like prison to me. Thankfully, there's a way out. It's called repaying the debt as quickly as possible. If that means selling assets or taking on a second or third minimum-wage job nights and weekends, it would be worth it to break those chains of bondage.
Should you ever find yourself in jail for being in contempt of court, get ready to run up even more debt. Harris reports that an increasing number of prison systems are charging inmates for their keep. It's as high as $60 a day in Springfield, Oregon. If you can't pay? Harrison is guessing they'll just issue a warrant for your arrest and put you back in jail.
©Copyright 2010 Mary Hunt
Everyday Cheapskate is a Registered Trademark
Originally published September 23, 2010.
