If you do not pay a debt when you are supposed to, the creditor can try to collect the debt in a number of ways.

The creditor can:

  • Report the debt to a credit bureau and damage your credit rating.
  • Try to pressure you into paying the debt or turn the debt over to a collection agency which will then try to do so.
  • If the debt is secured (that is, if you put up any collateral for the debt), attempt to repossess the collateral.
  • Take you to court to get a judgment against you.

By itself, a judgment is simply a court document saying that you owe a creditor a certain amount of money. You cannot go to jail for owing someone money unless you fail to pay court-ordered child or spousal support, or are guilty of tax evasion, or if you fail to pay court-ordered restitution as part of a criminal conviction. But a judgment does enable a creditor to use certain collection procedures that are not otherwise available.

See also…

Debt Collection – Forum