credit card nonpayment?

Question

What will a credit card company do for balance of $5300 that I owe them and am not able to pay?

Answer 1

Please disregard what these other people have written. I am a Mortgage Loan Processor for a large mortgage lender. I have worked with credit everyday since 1996. First of all, I have never seen a garnishment for a credit card debt. Usually, the only thing garnished from wages is child support and occasionally back taxes. That is not to say they couldn't garnish your wages,but I've never seen it and I doubt if I ever will. I can count on one hand the times I have seen a credit card debt as a judgement. They don't do things like that anymore.

What will happen is the credit card company will hound you for a while, trying to get you to pay. If you don't pay,they will charge off your account as a loss, sell your account to a collection agency, who will in turn, hound you some more, trying to collect the money. Then, seven years from the date of last activity on the account, it will drop off of your credit report. Seven years is the statute of limitations for collections and charge offs in the USA.

There are millions of people who have bad debt with credit card companies. These company's do not have the time or man power to sue everyone.

Now, this will hurt your credit score and it will affect any future credit you try to get for the next seven years, but it isn't as horrible as these other people that wrote in make it out to be.

If I were you and this hasn't already been charged off or gone to collections, I would call the credit card company and see if they will work out a payment plan that you can live with, so it doesn't mess your credit up.Try not to get yourself in so deep with any of your other accounts.

Answer 2

It won't be pretty.

Short answer....you are going to be much better off if you call them and tell them you are going to repay it a very little bit at a time.

If you try to get away with not paying.....

Well let's see....first they'll put you into their default interest rate, which is usually more than 30% per year.

Then, they'll start calling. They'll be nice at first. But pretty soon you are going to get tired of the calling and then they'll start getting meaner. They'll call all the time....they'll call your family....they can even call your neighbors.

If you continue to not pay, they will file a lawsuit against you and if you don't win (which you won't), they'll get a judge to order that you repay the debt. If you don't, they'll get the legal authorization to start confiscating your personal possessions (your car, furniture, etc.) until they get enough to make back what you owe them, plus court costs.

But since you've now defaulted on one debt.....it doesn't stop there. ALL and I mean ALL your other outstanding creditors will also raise your interest rate to the default rate.

This means you will now have to pay about 30% interest on all your other credit....which will make it MUCH harder to pay back any other loans you have outstanding.

Then, they report all of this to the credit bureaus which take a chunk out of your credit score.

With a bad credit score, you will either never get credit again or will only get a credit offer with very high fees and a huge interest rate (in other words a card you'd never want anyway).

This bad score doesn't just impact your credit.

You will have a hard time finding an apartment to rent because landlords pull these reports....

You will be heavily scrutinized when applying for a job because employers also use these reports....

And, you'll pay sky high insurance rates because bad credit risks are poor insurance risks as well...so they jack up their rates.

All in all, it is a really, really bad idea to not pay the loan.

As I said, you are much better off just calling the card company and telling them you are having troubles and want to work out an acceptable payment plan that at least gets them some money and keeps you contiually paying.

Maybe someday your finances will change and you can make more payments.

In the meantime, get a handle on your spending so you dont' get into this pickle again.

Answer 3

This Site Might Help You.

RE:
credit card nonpayment?
What will a credit card company do for balance of $5300 that I owe them and am not able to pay?

Answer 4

The credit card company will ding you with a lot of interest and they probably won't do very much to help you out. I would suggest going to see a credit counselor as soon as possible. Hopefully there is one near you that provides their services for free or for only a nominal fee.

Answer 5

Crystal B, when I was in undergrad, I racked up a lot of credit card debt and I only had a student worker job. Paying bills was cute, at first, then I kind of got sick of it so I didn't.

I just stopped paying on all of them, after I maxed them out.

I got calls and letters from creditors and collection agencies. I ignored all of them.

Eventually, they fell off of my credit report on their own. My credit is stellar now.

I still get threatening calls from Chase collection agencies, despite the fact that I had my new car loan with them and I have one of their credit cards (at 0% interest at that).

Answer 6

If your balance remain unpaid the company will forward it to a collection agency, unless they have one of their own. If you do not respond they will enter a charge off status on your credit report, this will seriously affect your credit rating and in the future increase your borrowing cost. The best course is to settle with them on a minimum payment while the card is closed. It will report in payment and help your credit rating.

Answer 7

They will keep adding interest
Then if you haven't paid anything
after a period of time, they will
take out court papers and file a
Judgement against you with
interest still be added every day.

Answer 8

Yes you will get a judgment and wadge garnishment. CALL THEM AND WORK SOMETHING OUT! If that fails call a credit consoling service. I judgment really messes up your credit and employment out look.

Answer 9

If you live in a state where they can garnish wages or your bank account, they can do so without even letting you know. You can thank this administration for allowing themselves to act as a collection agency for these people.

Answer 10

They will keep adding interest charges and if you continue not to pay, they will report you to collections (lowering your credit score), and could sue you.