If you fail to pay a bill, for example, you will receive a request for payment. This is known as a reminder.
If you fail to respond to this reminder, the person you owe money to can go to court. You will then receive an order for payment from the court by post.
If you fail to respond to this again, the court will send you an enforcement order.
After that, a court officer (“bailiff”) can come to your home and take away items of value - such as jewellery, for example - belonging to you (“seizure”). However, he may not remove certain personal items, such as clothing or your TV. Money can also be seized from your bank account.
You may also receive a negative “Schufa” entry, meaning that a credit agency will record in a database that you have failed to pay your debts. With such an entry, it will be more difficult for you to sign another contract later, for example for renting an apartment or for a mobile phone.