People end up in jail over a lot of things, and many people who get locked up don't have extra funds on hand to post bail and get out of jail. In the event that this happens to you, reaching out to a bail bonds agency for a loan can be one of the most financially sound decisions you ever make. Just like other types of monetary loans, the money will have to be paid back with interest or service fees. If you get in a bind and can't repay the money, you may consider filing bankruptcy.
Can you file bankruptcy on bail bonds?
The answer is surprising to many people, but you can indeed file bankruptcy on bail bonds in most states. At the most basic level, bail bonds are loans from a lender. A lender gives you or the court system money so you can get out of jail, and then that money has to be paid back according to the terms of the loan. Therefore, there is really nothing stopping a consumer from filing bankruptcy on the amount of money that they owe a bail bonds agency if they run into financial difficulties.
How do collateral-based bonds differ from surety bonds in bankruptcy proceedings?
Filing bankruptcy will be a bit different if you have a collateral-based loan instead of a cash or surety bond. Cash or surety bonds are given basically with no collateral; you are just giving your signed agreement that the debt will be repaid. Collateral-based bonds involve placing some form of tangible property, such as a vehicle or home, up as collateral, which means the bail bonds agency basically stands as a lienholder on the deed of the property. Just as it is if you file bankruptcy on other properties with a lienholder, the bond agency will have a right to seize the property even though other collections procedures must be stopped.
Do you let the bail bonds agency know you are filing bankruptcy?
It is not necessarily your responsibility to let creditors know you are filing bankruptcy when you owe them money and plan to file on the debt. The court automatically notified creditors during the bankruptcy filing process that they must cease with collections actions because you have filed. However, if you are having issues with bail enforcement agents seeking you out, you will no doubt want to let the agency know right away that bankruptcy is being filed.