The U.S. currently has 2.3 million people behind bars, the largest prison population in the world. Whether they were incarcerated for drug crimes or other offenses, one thing is constant for all of them: the world outside did not stop when they were imprisoned.
What Prisoners Leave Behind
Of the 2.3 million people in jail, most have families and friends waiting for them outside. Most also have their own responsibilities to take care of, and handling those affairs from inside is never an easy task. Despite the disruption jail places on families and friends, the disruption for the prisoners themselves can be overwhelming, especially financially. There are, however, steps that can be taken that can minimize the impact.
Putting Financial Affairs in Order
Among other considerations prisoners have to deal with is taking care of financial affairs, especially with credit cards. Creditcards.com, a part of the Bankrate network, which has been publishing financial stories for more than four decades, suggests 10 steps for those facing a prison sentence which will help them handle their financial affairs.
- Find someone you trust completely to take over your financial affairs. Inmates who can arrange for someone on the outside to take over car payments or negotiate reduced payments with creditors can emerge from jail without having amassed greater debt while inside, experts say. Otherwise, fines, fees and interest for everything from credit cards to child support or alimony payments can accrue over the years and make even a small debt grow to large amounts.
- Set up a joint bank account with that person before going to jail. It will be difficult to set up a bank account once you’re incarcerated, because federal anti-terrorism laws passed after the Sept. 11 terrorist attacks require account holders to provide identification and appear in person at the lending institution when opening an account. If a person isn’t available to help, there is potential to set up a trust with a responsible bank.
- Consult an attorney about drafting documents to give someone you trust your power of attorney. This gives the trusted person the legal right to make decisions on your behalf and gain access to checking and savings accounts.
- Contact all of your creditors and let them know that you will have difficulty making payments for a period of time. Many banks and credit organizations are willing to work with potential inmates. Their interests are to be repaid for the money the potential inmate owes them, and many times they realize payments will be difficult to make. As a result, sometimes they may be willing to negotiate terms.
- Vehicles may be repossessed unless you get someone to take over payments, insurance and maintenance. Again, find someone you trust. There are cases of family members selling the inmate’s car, truck or other possessions for cash.
- If you’re considering filing for bankruptcy, it may be difficult to fulfill the necessary requirements while in jail. The 2005 bankruptcy law requires debtors to get credit counseling before filing. Although these sessions can be conducted via telephone or the Internet, inmates are not guaranteed telephone time, Internet access is prohibited and physically attending the sessions is impossible
- Prisoners often have a difficult time finding attorneys to represent them. As a result, they file “pro se,” meaning they act as their own attorneys. The odds are great that the bankruptcy will be rejected. It may make sense for a prisoner and his wife to try to file for bankruptcy.
- Bankruptcy won’t help you get rid of or discharge several types of debt, including child support payments, federal student loans and court and restitution costs associated with your crimes. Those debts will remain on your credit record.
- If debt collectors are calling your family members asking for payment on loans, make sure the collection agency or creditor knows you are serving time. Instruct family members to give the collector the name of the facility so they can call to verify your whereabouts
- Inmates serving long prison sentences may feel that they can ignore their debts. And it could be true: By the time they are released, the state statute of limitations on many types of consumer debts (which varies by state) may have expired. However, it’s never a good idea to bet that a debt is gone – many times debts are sold, and creditors may show up at a later date to collect.