Pay Day Loan Returned Check
Many people file bankruptcy with the misconception they can take care of all their debts, including some that may be criminal. Filing bankruptcy only takes care of civil liabilities.
This may be confusing to some Debtors because some of their debts might be both civil and criminal. The main example would be a debt owed on a returned check. The bankruptcy will only take care of the civil liability. This means the debt is no longer owed to the person the check was written to. However, this does not prevent the creditor from turning the check over to the DA’s office and filing criminal charges.
I do have a client that a pay day loan place is threatening to press criminal charges if the check is not paid. The Debtor wrote a series of checks to a pay day loan place, and the pay day loan would cash the checks once a month. The Debtor then filed bankruptcy and included the debt owed to the pay day loan place. The pay day loan the n proceeded to cash the check on a debt they were not allowed to collect.
In this situation, the bankruptcy can protect the Debtor from criminal charges, because the check never should have been cashed. By cashing the check, the pay day loan violated the automatic stay. By threatening to press criminal charges and calling the Debtor, they continue to violate the automatic stay. Our office has contact the pay day loan creditor and informed them of their violation. At this point there is nothing else we can do unless the pay day loan tries to file criminal charges.
Please fill out our free evaluation form to determine if bankruptcy is right for you.
