In Debt and Bankruptcy is Not an Option?

WHAT HAPPENS IF YOU DON’T PAY A DEBT?

 

A creditor will likely contact you to pay the debt.  If you do not reach an agreement, the creditor may sue you to collect the debt.  Once a judgment is obtained, the creditor may collect a debt by wage garnishment, back account attachment or by placing a lien on real property.

If the debt “secured,” the creditor may repossess the property without filing in court first.  Secured debt is debt for which the lender has kept a right to reclaim the property.  This is in the form of a lien or mortgage.  If the debt is not paid the lender can repossess the property or force a foreclosure.

Your creditors cannot collect a debt from “exempt” property.  Exempt property includes certain income and real and personal property.

 

IF BANKRUPTCY IS NOT AN OPTION, WHAT ELSE CAN I DO?

 

Trusteeship is a plan you enter into with the Clerk of the municipal or county court where you live.  In order to qualify, you must be being sued and have a source of income which can be garnished, such as wages.  There is a small one-time charge for setting it up.  Each payday you give the court 25% of your salary.  The court pays this money to your creditors.  As long as you make the payments, your wages cannot be garnished.

 

Consumer Debt Counselors can help you set up a budget and a plan to pay your bills each month.  As long as you make the payments, your creditors agree to not seek to collect from you by garnishment or other methods.  

 

For more information see CLAS' other fact sheets:

Wage Garnishment in Ohio
What Is Uncollectible
Bank Account Attachment in Ohio
Repossession in Ohio
Debt Collection

Garnishment Calculator

 

 This article is meant for you general information and not to give you specific legal advice.

Prepared by Community Legal Aid Services, Inc. Updated February 2015.