Payday Loans

Can You Be Sent To Jail For A 5-Year Old Payday Debt That Is Still Due In Your Name?

As per the laws in the United States of America, inability to make the repayment of an old payday debt (or any other debt for that matter except child support payments) is not a criminal offence. So, there is no possibility of you being sent to jail for this even if you owe the outstanding debt for five years. But, if it is proved that you are not paying off the debt as part of certain fraudulent activities, criminal proceedings may be brought against you. In general, you are not going to be sent to prison for this offence. Your lenders can file civil lawsuits against you, but even in that case, the court will never award you with a jail sentence; the possible consequences in such cases include wage garnishment, liquidation of certain assets or even bankruptcy in extreme cases. No matter how much money you owe or for how long, the jail sentence is usually out of the realm of possibility.

Statute Of Limitations

If you owe a 5-year old payday debt and your lender is still enquiring about the payment, the first thing you should do is to check the statute of limitations applicable for such loans in your state. The legal provisions regarding statute of limitations vary significantly from one state to another. In some states, such as Texas, you cannot be held liable to pay off a payday loan debt, which has been outstanding in your name for the last twelve months. In other states, the statute of limitations can be two years, three years, four years or sometimes even seven years. If the statute of limitations has already expired, it is illegal for the lender to contact you for payments. In such cases, you have the legal right to file official complaints against the lender. You can even file a lawsuit against them for harassing you.

However, it is very important for you to keep in mind that statute of limitations on old payday debt accounts is counted from the date when you had last made the payment toward the debt. Even if the debt is five year old, but if you have been making small payment toward the same and the last payment you made was six months back, it will be legally considered as only six months have passed as long as the statute of limitations is concerned. But, if you have not made any payment toward your payday loan account for the last several years, the chances are that you no more owe the same (at least in legal sense).

Is Your Lender Threatening You That They Will Send You To Jail?

Though there is no provision for jail sentence under the US laws for borrowers who have 5-years old payday debt outstanding in their name, it is quite unfortunate that most lenders often harass consumers by giving false threats. If they are giving you phone calls or contacting you manually and threatening you that they are going to file an FIR against you and that you will soon be sent to jail, tell them with a calm head that you are well aware of the laws and you also know your legal rights. As per the Fair Debt Collection Practices Act (FDCPA), any such harassment by payday loan lenders is illegal. Always remember, you have the right not to be harassed even if you are unable to make the repayment on a loan. You even have the right to ask lenders and collection agents in writing that you do not want them to contact you either through phone or any other way. It is legally mandatory for lenders and collections agents to honor such requests made by borrowers. If they continue giving you phone calls, you can file complaints against them with your state authority or directly with the Federal Trade Commission.

Attending Court Proceedings Related To Debt

Though inability to pay off an old payday debt is not considered as a criminal offence, you can be sent to jail if you do not respond to a court notice and do not appear for court proceedings or do not follow a court order related to your debt. Therefore, if you have received a court notice regarding your payday loan debts, you must immediately respond to the same. Besides that, you must attend the court proceedings as well; this is your opportunity to defend yourself. Here, it is also important for you to keep in mind that the responsibility to prove that you owe the debts is on the lender. So, the best defense is to request the court to ask the lender to prove that you still owe the debt in legal sense. Most of the times, lenders fail to prove it, especially if the debts are very old.

Overall, if you owe a 5-year old payday debt and are worrying that you can anytime be sent to jail for this, you should stop worrying. But, if lenders are still harassing you, you must immediately contact your state authority for protection.


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