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Contempt of Court for Default Judgements

bankruptcy attorneyYou thought that you could just let a home go back in foreclosure and ignore a Kentucky lawsuit and submit to default judgment. Wrong! You can go to jail for contempt of court in Kentucky. You assumed Debtor’s prisons for Kentucky was abolished in 1833 so except for child support or taxes, jail is never used to punish someone for not paying. But Kentucky debt collectors have found that default judgments and contempt allow an exception and continue to use contempt and jail as a debt collection technique.

Debt Collector Strategy

Here is how they do it:

  1. The debt collector files a lawsuit legitimate or not so legitimate.
  2. If a Debtor is served with the complaint that also requests that the Debtor files an answer within 20 days. The Debtor ignores the judge’s order to answer within 20 days, then the debt collector gets a default judgment.
  3. Then the debt collector’s attorney files discovery after his judgment which includes interrogatories and a request for production of documents asking the debtor for information about where his assets are. Sometimes the Debt collector will ask for a hearing requesting that the Debtor appear to answer these question.
  4. The Debtor ignores and does not answer or appear in court (this attitude angers the judge).
  5. The Debt collector, then asks for an order of contempt of court and specifically jail, with the bail equal to the amount of the debt to get out of jail.
  6. The Debtor has to raise bail money to get out of jail, but the Debt collector simply attached the bail money who has always expected the Debtor to assume and ignore these requests.

How Your Bankruptcy Attorney Can Help You

This technique is popular with debt buyers that purchase charged off debts for pennies and later sue collecting the interest, attorney fees and full principle. There are cases of what are completely uncollectible debts being collected by “zombie debt” buyers who buy even bankrupted debts. These Zombie debt buyers purchase debts after the statute of limitations has run, Debtors have filed bankruptcy or that lack any of proof that Debtor even owes the debt. What Collectors and foreclosure servicing companies are doing is legal but they are relying on Debtors to give up and ignore lawsuits. The collection process involves weeks and months of work. Just because don’t hear anything doesn’t mean the clock isn’t ticking and you can ignore a lawsuit.