The United States Marshals Office has no direct involvement in the collection or recovery of federal loans given to students. However, they have given statistics showing there are over 3,000 student loan defaulters every day across the nation. While the total amount of money owed to the Federal government currently stands at $1.5 trillion spread among 44 million borrowers, most of them are actually not aware of the consequences of not being able to make payments. According to the Department of Education’s provisions and the terms of private student loan companies as well as personal testimonials, failure to repay student loans will hurt the individual’s credit score, the implication of which is that it will be difficult to secure a loan in future. However, such failure cannot get a student arrested.
It is imperative to note that the United States has not had a prison for debtors for close to two hundred years and one cannot simply be arrested for inability to repay student loans. On the contrary, loan servicers from the Department of Education will attempt for a year to get in touch with borrowers who have fallen off the track with regards to their repayments. Here, the defaulters are advised on the consequences of defaulting and given options on how to get back on track. Only in the event that all the options fail will the Department of Education be compelled by law to involve the Department of Justice, via litigation, in debt collection. However, it must be noted that borrowers of student loans cannot be arrested for the specific reason of nonpayment.
The image above was adapted from the U.S. Department of Education Website.
Can You Go To Jail for Not Paying Student Loans: An Analysis of Different Scenarios
Failing to pay student loans cannot send one to jail. However, it is the prerogative of every beneficiary to practice due diligence and find out what happens if you don’t pay your student loans. No legal procedures will immediately be initiated against defaulters, but the Department of Education will offer as much help as possible until they reasonably believe that the borrower has no intention of repaying the loan or is genuinely unable to. You may be wondering, can you go to jail for not paying loans? Well, there are many types of loans that may get you jailed but not student loans.
Federal student loans are different from private student loans. For example, it is imperative to note that federal student loans differ from the private student loans Texas companies offer. On the one hand, federal loans offer not only flexible repayment plans but also comparatively lower interest rates. On the other hand, the specific plans available for private loans depend on state laws, company policies and borrower-lender contract. Although even private lenders may not have you sent to jail for not paying student loans, you will go through the inconveniences of long and often costly court procedures. Whenever you require help, ask for it but also learn how to identify and keep away from predatory student loan companies.
US Marshals Student Loans: Minimal Arrest for Defaulters
You will definitely be arrested for other matters relating to your student loan but definitely not failing to pay. There was panic in Texas when the incident of US Marshals arresting student loans defaulters was reported in relation to one Paul Aker. However, this was unwarranted panic since there was more to the arrest than simple failure to repay the student loan. Aker received the loan in 1987, and there have been numerous attempts by the Marshals to contact him to come before the federal court. After numerous phone calls and several notices placed at his residence, he still refused to appear in court, prompting the court to issue his warrant of arrest.
Therefore, cases of US Marshals arresting people for not paying their federal student loans are indeed not true; they are arrested for refusing to honor court summons. It is common knowledge that when a court summons you, you have a duty to appear before it. However, it is more important, beneficial and much easier to seek help with student loans before they escalate to the point of being summoned by the court. You may not be arrested explicitly for defaulting on it, but not paying back student loans is a disservice to future generations.
Cases Where People Got Arrested For Not Paying Student Loans
With regards to the reports of a man arrested for student loans, the southern district of Texas’ US Marshals confirmed that the crime was contempt of court. It is important to perceive the US Marshals Service as an enforcement wing or federal courts. Therefore, they only served a civil process on the man and executed a warrant of arrest as the federal court had directed. The federal government has adopted the approach of contracting out the recovery of student loans to private debt collectors. So, persons not paying student loans may be arrested by US Marshals only when efforts to reach them or make them appear in court fail.
Debtors prison student loans are essentially exploitation of the criminal justice system and may be viewed as misuse of the system. Borrowers often fall behind on their repayments and the lending agencies contract collection agencies to recover the outstanding payment. When the debtors are taken to small claims courts, they fail to defend themselves mostly because they are not aware of the lawsuit or even by choice, and arrest warrants are then issued. You therefore wonder can you be arrested for not paying student loans. Technically, the arrest warrant does not cover the debt you owe; rather, it is the failure to appear before the court. Therefore, do your research on student loan repayment and stay informed. Do not be caught on the wrong side of the law!