There are about 465,000 people in American jails who are awaiting trial, according to the Prison Policy Initiative. It’s a sad fact that most who enter the criminal justice system (innocent until proven guilty) cannot afford to post bail, and the consequences are severe.
If you are under arrest and facing incarceration, a personal loan to post bail can help you keep your job, your freedom and more of your cash.
If you can’t afford bail
The cost of bail can affect your chances of acquittal. Defendants who go from jail to the courtroom have a much higher conviction rate and face sentences two to three years longer than those who walk into court freely.
Defendants who cannot post bail lose jobs. Their relationships with friends and family suffer. And their physical and mental health degrade significantly.
So you absolutely want to stay out of jail before trial if it’s at all possible. There are several ways to post bail.
How to post bail
If you’re an average defendant in the US, the cost of bail is about $11,700. And if you’re an average defendant, you don’t have the money. There are several ways to post bail:
The is the simplest type of payment. You pay the full bail amount (for this example, $11,700) to the courts in cash. Or by check or credit card if allowed in that jurisdiction.
Federal bail bond
If you’re accused of a federal or interstate crime, you’d post a federal bond. Your fees may be higher and you may need more collateral (assets you can pledge) to secure your release. Federal crimes include fraud, kidnapping, bank robbery, and hate crimes etc.
If you can’t post the entire bail amount yourself, you’d purchase a surety bond from a bail bond provider. Normally, you put up 10% of your bail amount. The bail bond issuer keeps that money as a fee for its service and pledges the bail amount to the court. If you fail to appear, the bonding company must pay the amount to the court. It will then pursue you for the money you owe.
A citation release is simply a written notice given by the arresting officer allowing you to go home and not jail. This is the preferred option for minor crimes.
In this case, you’d pledge property like a home or car instead of cash to ensure your appearance at trial. If you fail to appear for your proceeding, the court can seize the property.
Personal recognizance release
You may be able to argue for personal recognizance if you’re not a danger to the community or a flight risk. You’re more likely to be successful if the crime is minor. You won’t have to put up any bail. If you plan to argue for no bail, don’t pay for a bail bond that you might not end up needing. A personal loan, credit card or cash would be cheaper to get you out of jail before your bail hearing.
This type of bond applies to you if you’re detained for immigration reasons. Bail is often a little higher because of the flight risk associated with immigration crime.
Bail bonds, personal loans and credit cards
The total cost of bail depends on how you post it. If you can put up all cash, you won’t pay bonding fees or interest. But many awaiting trial don’t have that option.
If you need to post bail for a couple of months and use a bail bond company, you’ll pay 10% for the privilege ($1,170 in this example). That’s an annualized interest rate of 60%!
A credit card, if you have the available credit, may also be expensive. Count on paying, typically, 3% for a cash advance, no grace period before accruing interest, and paying a higher cash advance interest rate (usually about 8% higher than the rate you pay for purchases).
So for $11,700, you might be looking at a fee of $351 plus $585 in interest at 30% for two months. Total cost, not including any court-imposed fee for accepting a credit card: $936, or 8.14% of the balance borrowed for two months.
A personal loan may be a better option if your credit is good. Personal loans have fees ranging from zero to 5% to originate. Because posting bail is a short-term need, the upfront charges will be more important than the interest rate. Assume that you can find a loan with a 1% fee and a 15% interest rate, your cost for two months would be $410 (3.6% of the amount borrowed).
How long does it take to post bail with a personal loan?
One reason that many use the bail bonds system is that it’s fast and convenient to the jail. But personal loan vendors can also be very quick. You can get a loan online and have money transferred to your account in a day with some providers.
When is a personal loan the best choice to post bail?
A personal loan is a lower cost option when your credit is good enough to secure a loan with few or no upfront costs. The interest rate is less important than the fees for this type of transaction.
But if you don’t qualify to borrow enough to post bail, or your interest rate and fees are very high, you may be better off using a bail bond company. And if you don’t have the 10% needed for a surety bond, you may be able to borrow that with a personal loan.
Anything you can do to stay out of jail before your hearing is probably worth doing.