Criminal Debt and Bankruptcy: The Facts

Posted by Alesha Struthers Jan 25, 2021

Criminal debt is a type of court-ordered debt that results from a criminal matter. It is money that the defendant is ordered to pay after they either plead guilty or nolo contendere to their charge or charges. Criminal debt may also be known as a criminal fine.

The purpose of criminal debt is for the defendant to pay for their crime in one or more ways financially. In this article, you will learn about the types of criminal debt that may be assigned, the rights a defendant has related to criminal debt, and whether bankruptcy is available to help a defendant deal with the financial toll that this type of debt can have on them.

If you're struggling with your debts, the Law Offices of Alesha Struthers may be able to help. We provide free initial consultations related to Chapter 7 bankruptcy in Washington state. While bankruptcy isn't always the solution, it can provide many people with a new financial start. To learn more about Chapter 7 bankruptcy and whether it might be helpful for you, schedule your free consultation now.

Types of Criminal Debt

There are several types of criminal debt. The key to remember is that the debt is assigned as the result of a criminal case. Also, the Law Offices of Alesha Struthers certainly is not passing any sort of judgment on anyone who may have criminal debt of any kind. We are simply providing this information for educational and informational purposes only. This information does not replace legal advice and it is not legal advice.

The most common types of criminal debt include:
  1. Restitution to the victim;
  2. Restitution for damage to property;
  3. Monetary fines assigned by the criminal court for a misdemeanor or felony;
  4. Administrative fees or costs assigned by the court (including probation or parole costs, costs of incarceration, attorney fees, costs associated with extradition, etc.);
  5. Surcharges;
  6. Interest;
  7. Collection costs related to restitution, fines, fees, surcharges, or other criminal debt; or
  8. Other assigned monetary penalties.
Is Debt a Civil or Criminal Offense?

Court ordered debt is only a criminal offense when it is assigned by a criminal court. Otherwise, it is only a civil matter. When debt is a civil matter, there are, of course, still consequences for non-payment. However, when debt is a criminal offense, the stakes are much higher for non-payment. If you have criminal debt and you do not pay your debt for any reason, you could be incarcerated.

The good news is that if you have criminal debt, you do have the right to look into whether you are eligible to qualify for a payment plan. It is important to look into setting up the payment plan as soon as the debt is ordered because most fines and fees assigned are often due within 30 days of assignment. If they aren't paid within that time, you could incur interest and your account may be turned over to collections. You could also put yourself at risk to be incarcerated as previously mentioned.

Once your payment plan is set-up, make all of your payments on time. Keep proof of all of your payments. If you cannot make your payments, it is important to talk with your attorney immediately about how you may be able to remedy the situation at least on a temporary basis.

What Happens with a Civil Judgment?

Although this article is about criminal debt, we will briefly explain what happens with a civil judgment to highlight the difference between civil judgment and criminal debt. If you have a car repossession, foreclosure, or unpaid medical bills, the creditor may decide to sue you. This is not a criminal matter. While you owe money, this is not a crime. It is a civil matter. In fact, the Fair Debt Collection Practices Act is clear that creditors, including debt collectors, cannot threaten to sue you unless they actually plan to file a lawsuit.

If the creditor sues you and wins, they receive a civil judgment against you. A civil judgment may show up on your credit report for several years. Additionally, the creditor may pursue a remedy such as a lien or a garnishment. However, you cannot be arrested.

Disclaimer: This publication is not legal advice. It is intended as legal information only. For legal advice specific to your needs, contact the Law Offices of Alesha Struthers, PS at 800-972-0411.

Posted January 2021