2419 Maryland Avenue
Baltimore, MD 21218

What Is The Maryland Central Collections Unit?

Created in 1973, the Maryland Central Collections Unit is the collections arm for every agency run by the State of Maryland. It was created because legislators realized it was inefficient for 400 different state agencies to each try to collect its own debt.

If someone ended up owing a debt to the State of Maryland, the individual agency has to send the person a collection letter. If the person doesn’t respond, then after around 90 or 180 days, they will refer it to Central Collections, which will take over collections at that point.

Is There Any Way To Avoid Them Being Able To Intercept A Tax Refund?

The main ways to avoid having a tax refund intercepted would be to either set up a payment plan with the state or to file bankruptcy because the state, like any other creditor, will have to stop collections in the wake of a bankruptcy. Not only that, but some debts with the State of Maryland can actually be wiped out in a Chapter 7 bankruptcy, whereas they could be paid off in a payment plan that can be set up in a chapter 13.

Another advantage is that, while the person was in the bankruptcy, the state couldn’t hold up the person’s driver’s license or vehicle registration. Many people come in and file a bankruptcy in order to get their car back on the road and renew their license renewed, because they found themselves caught up in some debt they owed to the State of Maryland.

How Does Being Sued By The State Of Maryland Affect The Person’s Spouse?

The only way that would matter would be if the spouse was liable on the debt because no creditor can collect from someone not liable for that debt. The person and their spouse may be liable for some debts, whereas other debts may only be in one spouse’s name; they couldn’t garnish the other spouse’s paycheck for that.

Whether they could put a lien on real estate would depend on who owned it; they may not be able to place a lien on the house if the person owned it with their wife and the wife was not liable, if the judgment was just against one spouse. The general rule is that it may not become a lien if someone owned a house jointly, but the person should consult with an attorney to know how that would work out based on their situation.

How Long Is Too Long To Wait To File A Bankruptcy After Someone Had Been Sued?

The longer the person waits, the worse things will get. If someone files before there is a judgment against them, they won’t have to deal with the judgment that may become a lien on their property, but if they wait until the State of Maryland got a judgment against them, they will have to deal with collections, the paycheck garnishment or interception of their tax refund, so depending on the timing, some money may be lost forever.

Sometimes, when people file a bankruptcy, they will be able to get any money back that creditors had taken during the 90 days since the case was filed. It’s always a good idea to see a bankruptcy attorney if someone has been garnished, to see if they can get that money back, because once that 90 days passes, it may be too late to do anything. However, once someone gets to where a lawsuit has been filed against them, it’s a good time to take action, because from that point on, it’ll only get worse.

For more information on Central Collection Unit, a free initial consultation is your best next step. Get the information and legal answers you’re seeking by calling (855) 4MD-BANK today.

Getting Out of Debt - The Truth About Debt Consolidation, Bankruptcy and Debt Relief

FREE DOWNLOAD