Legal Dictionary

INDEBTEDNESS

Indebtedness is the state of owing people money, or being indebted to them. For example, indebtedness occurs when someone takes out a mortgage, or finances a car. Most people cannot pay for a home or a car outright, and so they are indebted to the bank for the amount of the loan that was given to them. Using a credit card to buy such things as clothing, or to pay for a trip, results in indebtedness. Indebtedness is not the same as a failure to pay. Someone can be indebted to the bank because he owes the bank money, but his monthly payments are still current.

Modern Debtors’ Prison

The idea of debtors’ prison still exists, even though there are no longer brick-and-mortar buildings where people are locked away for their indebtedness. Modern debtors’ prison is a term sometimes used to refer to the practice of locking people up in a regular jail cell for their failures to pay criminal fines, or court-ordered child support.

Early Debtors’ Prisons in the U.S

Early debtors’ prisons in the U.S. were a prominent force within the country, especially after the War of 1812. Many citizens fell on hard times as a result of the war, causing early debtors’ prisons in the U.S. to be filled with those who were unable to pay what they owed. As a result of so many people being imprisoned over something so trivial, attention was now turned to the idea of debtors’ prison in and of itself. Many began to look unfavorably upon the practice.

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