What happens if I don’t pay my credit cards?

What happens if I don't pay my credit cards

Imagine this: Your monthly credit card bill comes in and you get that sinking feeling in the pit of your stomach because you know your bank account doesn’t have enough money to make the minimum payment.

Many of us have had this unpleasant experience. And in those cases, the thought that runs through your mind is, “What happens if I don’t pay my credit cards?

Below, we’ll attempt to describe all the possible scenarios that can result from not paying your monthly credit card bill and provide advice for how to handle these situations.

What to Do First If You Can’t Make a Credit Card Payment

Before we go any further, it’s important to explain what you should do immediately as soon as you realize you can’t make a minimum payment:

1. Find the phone number for your credit card company and give them a call.

2. When you get a customer service representative on the line, tell them that unexpected circumstances have made it impossible for you to make your minimum payment on time this month (If this is the first time it has happened, make that clear).

3. Tell them when you will be able to make the payment.

4. Ask if they can change your due date just this one time and if they would be able to waive your late fee.

If the steps above work, then make sure you pay the bill by the new due date (and make a plan to get out of debt so this doesn’t happen again – ReadyForZero can help). If the steps above don’t work, then ask if they could at least hold off on reporting the late payment to the credit reporting agencies that handle your credit report.

After One Missed Credit Card Payment

Okay, now let’s consider what happens after you have missed one payment (and remember, paying less than your minimum payment is equivalent to a missed payment). When this happens, you will immediately be charged a late fee of approximately $25-35. Since late fees get added right onto your balance, it will begin accumulating interest just like the rest of your debt!

But in the long run, a late fee is not the most damaging consequence of a missed payment. Let’s consider all the possible consequences:

  • you are charged a late fee
  • you get a bad mark on your credit report
  • your interest rate goes up

Those last two are actually much more serious than the late fee.

If you have an “introductory” or special interest rate, you might lose it after a missed payment. That could cost you hundreds or even thousands of dollars. Your interest rate might go up by 10% (from say, 15% to 25%) and if you still have years left to pay off your balance, that additional interest will add up to a painful amount (see our article on the Impact of One Late Credit Card Payment for more details). Of course, you could try to switch to a card with a lower interest rate, but that would depend on your credit score

Which brings us to the other big question: will one missed payment (or late payment) affect your credit score?

The answer is that it depends entirely on the discretion of your credit card company, which has the right to report a late payment to the 3 major credit bureaus (Equifax, Experian, and TransUnion) after 30 days. The credit bureaus maintain your credit report and compile your credit score, which lenders use to determine whether to let you borrow money – and at what interest rate.

When you have missed a payment, your credit card company can play “hardball” and report you immediately after the 30 day window is up, or they can give you a bit of time to fix the problem before reporting it. Fortunately, credit card companies cannot report a missed payment less than 30 days after the due date. They must wait at least 30 days to see if you are able to pay before the next due date rolls around. Keep in mind, if you already have a history of missing payments (or making late payments), they will be more likely to report you after the 30-day mark.

After Two Missed Credit Card Payments

Now we’re getting into more dangerous territory. After the second missed payment, you will be charged another late fee of $25-35 and the credit card company will be more likely to report your late payment to the credit bureaus. The point at which a late payment is reported to the credit bureaus can vary quite a bit. There’s a grey area between 30-60 days late where some companies will report and some will not. Once you are 90 days late, however, it will almost always be reported.

So if it’s reported to the credit bureaus, how much will the late payment hurt your credit?

Unfortunately, it will have a pretty dramatic effect. Experts say that regardless of your current credit score, a mark of 30-60 days late will usually lower your credit score by 60 to 110 points!1 For example, if you have credit score of 740 it might drop all the way down to 640. That means you’d have to pay higher interest rates on any future credit cards or loans you get – including home mortgages, auto loans, etc. However, if you make the payment before it becomes 90 days late, you will escape the worst of the damage to your credit score. (The negative impact will fade much more quickly – perhaps within a year or two – compared to a payment that is more than 90 days late, which will hurt your credit score for up to 7 years)

Also, at this point on the timeline (30-60 days late) your account will likely be given to in-house debt collections specialists. That is not the same as being turned over to a collections agency, but it is an intermediary step as the company tries its best to recoup the money it is owed. At this point, you can expect to receive calls from the internal collections agents who work for the credit card company.

They will generally be polite but firm, and will warn you of the consequences of non-payment. Sometimes they’ll offer you ways of settling your debt without paying the full amount. If you’re in a position to make a payment at this time, you might be able to negotiate at this point and possibly avoid paying some of the late fees that have piled up.

After 6 Months of Missed Credit Card Payments (180 Days Late)

By the time you are 180 days late, you are usually in a world of hurt. For one thing, you’ve been charged late fees (of about $35) for the last six months. For another thing, your credit report is now definitely showing your multiple missed payments, which means your credit score is certainly sub-prime (less than 660) and possibly even below 600, making it very hard for you to borrow in the near future.

Many credit card companies will “charge off” your debt after about 6-7 months and at that point they will usually sell it to a third-party collections agency. Which means that although your original creditor has given up on collecting the money you owe, a new creditor now owns your debt and has the right to collect from you.

Usually the new creditor is a collections agency, and unfortunately, they may not be as polite in their communication with you. In fact, sometimes their tactics are downright abusive. Fortunately, the law protects you from the worst forms of harassment by debt collectors, so be sure to know your rights. And if you experience abusive behavior by a collections agent, be ready to report it. (If you have questions about how the law works, you can post a comment below)

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Many Years After a Missed Credit Card Payment

By now, you can see the consequences of what happens if you don’t pay your credit cards. But what about many years later… Is there any point at which your failure to pay your bills will fade from your credit report? And what about your legal liability for paying the money back – does that ever go away?

The answer to both questions is “Yes.”

However, the timeline for having your debts forgiven by the law and by the credit bureaus is pretty long. In terms of your vulnerability to getting sued by your creditors, the statute of limitations can be anywhere from 3 to 10 years, depending on which state you live in. To see what the law is in your particular state, you can use this handy tool.

You also need to be aware that certain actions you take might extend or even restart the statute of limitations. In some states, making another payment or even acknowledging that you owe the debt can cause the statute of limitations to begin anew. If you want more details about this, please take a look at this article.

As for how long an unpaid credit card bill might stay on your credit report, the number to keep in mind is 7 years. After 7 years, the bad mark will no longer show up on your credit report.2

———

We hope in the future you won’t have to wonder, “What happens if I don’t pay my credit cards?” But if you ever find yourself in a situation where you can’t pay, at least you’ll have enough information to know what you should expect. Also keep in mind, some rules vary based on which state you live in (for example, Texas may be different than Florida or California).

And as always, if you have any questions, please let us know.

This article is part of our Credit Card Debt Resource Center.  If you’re looking for additional information about credit card debt, be sure to pay a visit!

  1. Source: Even barely late payments can impact your credit score! – Jeremy M. Simon []
  2. Source: How Long Does Information Stay On My Credit Report? – Diane Moogalian []

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  • for the people

    I always wondered about this.  I wish I’d known this when I was helping my mom with bankruptcy.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      I’m glad the information is helpful!

      • Gmama

        If you don’t file for bankruptcy and wait like you’ve stated about 7 years, then your credit score should be higher? Also, will they ever touch any of your current savings or compensation?Anyone allowed to even touch your 401K as well? Thank you.

        • http://www.twitter.com/bwfeldman Benjamin Feldman

          My understanding is that a creditor would have to sue you and a get a court judgement against you in order to recoup money from your bank account. However, I’d recommend researching this thoroughly to understand how your unique situation may be affected.

  • http://www.2knowmyself.com/ Farouk

     interesting info
    though i don’t like to stay in dept its good to know this
    thank you :)

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Thanks for your comment – good to hear it was useful to you!

  • http://www.facebook.com/jude.vacationphotos Jude Vacation Photos

    thank you.. very informative.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Glad to hear you found it helpful! Thanks so much for your comment.

  • CLin

    Ben,

    Does that mean if I’m in Texas, I’ve the option not to file bankruptcy chapter 7?
    I can just stop paying all credit card bill, and once 7 years past, my credit score will be back to normal?
    What’s the different between just not paying credit card bill and to file chapter 7?

  • Kerryberry66@hotmail.com

    I am single and have twin Boyz of 5 years old between the day care and work I am major in dept with credit cards about $40000.00 what can I do

  • http://www.facebook.com/latae.da.ish Latae Booskie Le’Rae

    Hi Ben, I was wondering, I loss my job back in July, and I have a $1,600+ debt to pay off; Min. of $100 monthly and if I don’t pay (which i haven’t since i loss my job) and I do not currently have a job and the company is contemplating pursuing a lawsuit. Do you know any good credit card companies that would lend me money without me having an occupation at the moment and I don’t have to repay monthly, I could repay within 6 months to a year? I am a full time student at a University so I cannot obtain a job at this moment. Thanks for your help!

  • BabyOnDaWaii

    Ive constantly wondered about this. Personally I had acquired a credit card at the age of 19 when i had a job lost it and been unable to make payments on it. After acquiring a new job and having to move out and taking care of my family I havent made any payments on the original debt since i first acquired it. I am currently 25 and i am aware of the debt and would like to clear it up as in this stage of my life it has affected me tremendously now that i have the means to do so would it be smart to try to pay it off now after years of built interest or just wait for it to go away Statute of limitation on my state is 6 years and after 7 the debt is off my credit score.Is it better to wait and start over on lesson learned?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi there, since I’m not a financial adviser I can’t give you a specific recommendation. In general I think that once a debt has passed the statute of limitations it is probably better to consider it a lesson learned the hard way and to instead focus on securing your financial future rather than making payments on a debt that has passed the statute of limitations.

  • pacman

    HI Ben, informative site. Can credit collection agencies go after 401Ks or IRA’s? Thanks.

  • Bob J.

    Wells Fargo charged me a $50 late fee when my payment did not meet the min. for my business credit card. I thought the max was $25 for a late fee?

  • rain

    Hey, I am in debt about 20,000 and can no longer keep up with the payments. I don’t own a house, I have a job working as a personal assistant and am in school full time. I think about my debt every day. I am making the bare minumum payment. i can’t do it anymore. please help. i am willing to just have bad credit. i live in new york.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Rain, I’m really sorry to hear about that. If it helps, you should be aware that you are not the only one who is in this position. Here’s what I would recommend: Take a look at this post:
      http://blog.readyforzero.com/how-to-get-out-of-debt
      And these resource centers:
      blog.readyforzero.com/resources/
      Read through those and see if there are any points that might help you. For example, if your debt is student loan debt consider doing the Income Based Repayment program. If your debt is credit card debt, consider doing a balance transfer or a debt consolidation loan:
      http://blog.readyforzero.com/resources/debt-consolidation/
      Sometimes, making a few small changes like that is enough to give you a little more breathing room so you can continue making your payments until you have more income. Lastly, you can also talk to a credit counselor for advice if you feel hopeless:
      http://www.consumer.ftc.gov/articles/0153-choosing-credit-counselor

      You can also try using ReadyForZero and see if it helps to see all your debt in one place.

  • Ley

    Hi,
    I reside in Cali and haven’t had any job for years. I stopped paying my credit cards for 4 months now. It’s really hard to keep up with the minimum payments specially I don’t work and I’m paying rent with the needs and with 2 kids to support. My question is, will the creditor sue me or put me to jail for not paying my cards? I have 4 credit card and 1 BILL me later which totals to $8100. I’m so scared that they will just come knocking my door. Thanku

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Ley, I’m sorry to hear about that. It sounds like a very challenging situation. Usually, after 4 months of not receiving payments the creditors will sell your debt to a collections agency. They may call you a lot trying to get you to pay the debt. You have rights you should know about:
      http://www.consumer.ftc.gov/articles/0149-debt-collection
      Also, it’s possible they might try to sue you for not paying, however, I don’t know how likely that is. For reference, I found this article that has some tips in case you do get sued:
      http://money.msn.com/debt-management/7-ways-to-fight-a-debt-lawsuit

      • http://www.twitter.com/bwfeldman Benjamin Feldman

        Also, you may find this resource center helpful:
        blog.readyforzero.com/resources/credit-card-debt/

  • jordan

    hey great article. I was wondering after 6 months or so what if they didnt hire a collection agency and continued to charge you late fees? Im in this position right now with capitol one and i was wondering if they will ever stop givin me late payments. My card isnt active, i havent been using it so why should i continually recieve late payments?

  • Sam

    Hi,
    This was the best article on the subject. However my situation is tricky.
    I owe like 15K and not living in US anymore. I may come back for visit but not to live. I can’t afford to pay this back.
    Can they take any legal action that can effect my arrival to US and my visit of few weeks?
    I know my credit history is screwed by now….

    Cheers.
    Sam

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Sam, I’m glad you liked the article. I’m not aware of any legal action they could take that would affect your trip to the U.S. At most, they can get a judgement against you which allows them to recoup money in a variety of ways. I’d suggest studying the statute of limitations and any judgments against you so you’re prepared for whatever course they decide to take.

    • Lilly

      Hi Sam,
      I am in a very similar situation as yourself. I have incurred enormous amounts of debt in the US but also currently live overseas, with no real intention of moving back. I am, however, going back the US for a visit in a month, and would like to ask if you’ve found any real answers to your questions..? Can they take legal action? Did you have any bad experiences while visiting? Pass along any information, if you can, I’d appreciate it!
      Thanks,
      Lilly

  • Marianne

    Great article and very helpful. My story is complicated and it’s not about me…it’s about my 76-year old Mother on a fixed income and needed to use charge cards to pay for her prescriptions, cash advances for other things she needs medically. Cut to $10,000 in debt and a $339 minimum payment a month that she CANNOT afford. My brother and I make peanuts so we cannot help her out. At her age, is it a big deal to have “bad” credit. She rents an apartment, owns nothing, has nothing to leave my brother and I, except a very small life insurance policy. She will be unable to “live” her life if she pays them $300 a month. What would be the tragedy in her paying them $100 a month in a showing of good faith. What can they possibly do to her?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Marianne, that’s definitely an interesting situation. There are not many reasons why a bad credit score would matter to someone who is 76 years old, but what if she needs to borrow more in the future for further medical expenses? If she is behind on payments, it will be harder to do any more borrowing (depending on what her credit limit is). Other than that, I can’t think of any other potential disadvantages to her of having a lower credit score unless she had any plans to find another apartment to rent, which sounds unlikely from what you’ve said. Good luck to you and your mother, and let us know if you have any more questions.

      • N.Williams

        Your comments to Marianne were interesting. I will be 80 Dec. 2nd, worked until I was 79. Now having problem living on retirement and paying cr. cards due to interest and inability to make substantial pmts. I value my good credit but may have to stop paying cr. cards to have money to live on. Had to help unemployed two kids due to economy, so was unable to keep any savings. I have insurance pmts. and prescriptions that take precedence. I investigated a payment plan but would not help me substantially. So, my best alternative to being too broke for necessities is to just not pay the cr. cards?

        • http://www.twitter.com/bwfeldman Benjamin Feldman

          See my reply above. Thanks!

  • Dylan

    This is really good information for the most part. My only issue is
    the idea of a late payment, less than 30 days, hitting your credit report. Credit card companies cannot report a late payment to the credit bureaus “immediately” upon missing a payment deadline. They all have to wait 30 days. There is no reportable category for being 1-30 days late. Once you are 30 days late, that can be reported as being late and appear on credit reports as 30-60 days late. The credit card companies can still add a late payment fee, but nothing is reportable until 30 days after the due date when payment has yet to be received.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Dylan, thanks very much for your comment! You are absolutely right, and the initial article didn’t make this clear. I’ve just updated it, so hopefully it states this much more clearly now. By the way, you seem to have a background in this field – would you be interested in writing a guest post for us? If so, let me know!

  • Thomas

    Hi Ben I haven’t pay my credit card debt, close to 7 years now but the other day I accidentally apply for a credit card because i thought i was just making a store membership card to get a discount and it was denied, does my statue of limitation time renew again?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Thomas. The statute of limitations on your previous debt should not be affected at all by applying for a new credit card. So that’s good news! An example of some things that would affect the statute of limitations are making a payment on the old debt or negotiating a new payment plan on the old debt.

  • Nelda Williams

    I wrote below Marianne, below. I quit working at age 79, be 80 in Dec 2013. I live in house I am buying, paying for car, utilites and have medical insurance and monthly medical prescriptions. I do not anticipate needing credit for medical since I purchased supp. Medicare insurance. I considered getting a payment plan to reduce interest on cr. cards but that does not free up sufficient money for necessities. I’ve had to use the cr. cards to live on because the payments use up my cash. At my age, would I be better off to just not pay the credit cards, forget about maintaining my good credit rating, and use the money to live on? Thanks for any input

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Nelda, thanks for the comment. If you don’t expect to ever use credit again, then you don’t necessarily have to worry about your credit score. But it sounds like you may need to rely on credit for medical expenses in the future. If that’s correct, then it may be important to keep a good credit score. What may be most helpful is talking to a financial counselor or expert who can look at your situation and help you find the best option. Also, if you’re interested in talking to me about your experience for an upcoming blog post, please let me know!

  • jerry

    isa rin po akong cc holder at hindi po ako nakapagbayad simula ng mawalan ako ng trabaho. Marami po akong narereciv na harrassment thru phone cals & demand letter from the collecting agent, at kanina nga po ay may nareciv ako na demand letter specifying na inirerecomend na ng law office na mag file ng civil against me… ano po ang dapat kong gawin…kelangan ko po bang gumawa ng panibagong utang para byaran sila ganung kahit alam ko n wala naman ako ibabayad sa gagawin kong panibagong utang… please help me…

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Sorry, I’m having trouble understanding. If you could summarize the question, I’ll do my best to answer it. Thanks!

      • http://www.twitter.com/bwfeldman Benjamin Feldman

        I’m not sure if this would be helpful, but here is a resource center that might be useful:
        blog.readyforzero.com/resources/credit-card-debt/

  • Lorena

    This is very helpful ! May I get your advice for my friend who has not paid his credit cards for 10 months already because he has children in college and a house to pay in his country. If he goes back to his country without paying his credits cards, what would happen? He has an HI-Visa . On his behalf, may I thank you.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Lorena, unfortunately I don’t know what would happen in that specific situation. It might be worth talking to a lawyer or financial adviser. Or perhaps you can find the answer somewhere on the web. Good luck!

  • 147

    My mom got a paper from the court but she had moved out USA 5 years ago. What do I need to do? She comes to visit every other year tho.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi, I’m not sure I completely understand your question. Was the court document in regards to an unpaid credit card debt?

  • Rob Angeli

    I am over 8 Months late with Bill me later so its already in the credit bureau makes it sense to pay it back now ? or sit it out the 7 years? ( can i get them to report it is paid now ? does it help me) its not a huge amount about 800.- thanks

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Rob, this is a complicated question, but yes, if you agree to pay back the amount in full then you should require (with proof in writing) that the lender mark the account as paid in full on your credit report. Make sure to get any agreement in writing!

  • Carlos

    Hi Ben, many thanks for your useful blog. I have a question. I arrived to US on July 2012. At that moment we did not have enough savings to get a car, therefore I bought a car with a loan on January 2013. Unfortunately, I have to pay an incredible high interest (~22%). It surprised how a low income family has to pay this kind of unfair rate with the excuse to built credit history. Anyhow, I have done an incredible effort to pay monthly my due.
    At moment, I got a job in other country and now I am facing the challenge to sell this car. The car is excellent but the market price is very low that my payoff. As I said, I am the head of a low income family and if I sell the car I cannot pay the difference.
    So, what happen if I return the car to the bank, leave US and forget about this bad experience without pay the rest of the money. Or which alternatives I have?
    Many thanks for your help,

    Carlos

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Carlos, I’m sorry to hear about this situation – it must be very frustrating. I would recommend contacting your lender and asking them if you can do a “voluntary repossession.” That would mean giving the car back to the lender and asking them to take the value of the car off your remaining loan amount. However, even in that case you would still likely owe some amount because the value of the car probably would not cover the full loan amount.

  • Gianfranco Cuello Morales

    Hi Ben,

    I moved out of the country in 2011, back then I was graduating college and i owed about 2k in credit cards, a phone company cancellation fee about 200, about 14k in stafford loans and 2k in perkins loans. I have defaulted on everything because I moved away and had to take care of my parents and their business in their home country. Im currently paying back my stafford loans online and with a customer service rep every month. but I havent heard from the collection agencies that have all my other loans stacked up. Im interested in moving back to the states, but im afraid i wont be able to find a job given my destroyed credit report, I also found out that my bank account in the states was closed apparently for credit issues. I really need help sorting this out. Im in no capacity to pay that debt in full, and given that i need a job i feel that if i go back to the states ill be harassed and the little money i make, taken from me by court order. WHat would you suggest in this case?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Gianfranco, sorry to hear about the challenges you’ve had – I’m sure it must not have been easy. As far as your current situation, there is nothing I can predict with certainty. Creditors don’t always sue to reclaim debts. It’s possible that the worst outcome so far from defaulting is that your credit score is very low. It’s also possible there are already judgments against you that you don’t know about. Probably the first thing you should do is log onto to annualcreditreport.com and get your free credit report. This will give you an idea of what the situation is. But ultimately I think you won’t be able to predict for sure what would happen if you return to the U.S. One more thing I’ll say is that you shouldn’t assume your credit score will keep you from finding work – unless you happen to know that employers in your industry always check the credit score. Fortunately, there are still many employers who don’t check credit scores, so I wouldn’t let that fear alone deter you. Good luck! And let us know if you have further questions.

  • JonE

    My wife has 4-5 old credit cards that are chargeoffs dating back 4-5 years now equaling roughly $25-30,000. If we had the money to pay off would you at this time? Or wait beyond 7 years? Also, if we settled with each collection agencies that own this debt do you think theyd atleast note it as paid in full on a credit report if not remove the chargeoff? Dont really know what to do at this point.

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Jon, I can’t give specific advice like that. Ultimately those kinds of decisions are up to you – is it important to improve your credit score in the near future? (i.e. are you planning to get a mortgage?) Do you have enough money to pay off all the old debts? Do you mind waiting the full 7 years for those accounts to fall of the credit report? These are all questions that only you know the answer to, and those answers will help you decide which direction to take. I will say that in some cases you can get collection agencies to report the account as paid in full after they receive payment, but you want to make sure to get any such agreement in writing before you hand over the money.

      • http://www.twitter.com/bwfeldman Benjamin Feldman

        Also, in case it’s helpful, here are some resources that might be helpful:
        blog.readyforzero.com/resources/credit-card-debt/
        blog.readyforzero.com/resources/credit-score/

  • clara

    I’m Mrs Janices by name. I live in SA, i want to use this medium to alert all loan seekers to be very careful becauseh there are scammers everywhere.Few months ago I was financially strained, and due to my desperation I was scammed by several online lenders. I had almost lost hope until a friend of mine referred me to a very reliable lender called Rev.John who lend me an unsecured loan of 85,000 under 2hours without any stress. If you are in need of any kind of loan just contact him now via: sangqiangcashloans@yahoo.co.za I‘m using this medium to alert all loan seekers because of the hell I passed through in the hands of those fraudulent lenders. And I don’t wish even my enemy to pass through such hell that I passed through in the hands of those fraudulent online lenders,i will also want you to help me pass this information to others who are also in need of a loan once you have also receive your loan from Rev.John, i pray that God should give him

    long life his email. sangqiangcashloans@yahoo.co.za .Thanks

  • Jason

    I have held out since the making home affordable program ruined my credit and credits cards immediate demanded three times the payments or payment in full. This has gone on for four years. No payments on over $65k in credit cards. Home depot card has to be forgiven for home repairs but the remaining has held. In all cases I requested to go to court so I can play recorded messages from Chase, Wells Fargo and Bank of America all threatening to foreclose on my house and relinquish my pay. On every card I denied the debt and demanded court. Q- how many law firms will generally take the accounts before they give up. Or how long does the account travel around? and, Will I be notified when the account is closed? I send cease and desist letters after every message and twice I have been called to court and both times they failed to arrive. Its been over two years now I am bored waiting for court even if I lose I want to play the harassment and threatening calls in court…

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Wow Jason, that sounds like an incredibly frustrating situation. I’m sorry you had to go through that. I’m not sure how many times they can sell the debt to another collections agency but it may have something to do with the statute of limitations. I’d recommend looking at the statute of limitations and maybe that will help answer your question. Sorry I can’t be of more help! On a side note, your story would make a very interesting blog post. If you’re interested in telling your story, please let me know and we could feature it on our blog. Thanks!

  • patty

    Benjamin,HI My parent at 89 yrs are both in the same boat as Marianne. Credit card debit, 8,000.00 CC debit and only Soc security enough to pay bills , mortgage on condo( only a few thousand in equity here as most is still owed), food, medical and utlitlies and without the credit card they are barely making it .They are broke . Can the creditors touch the condo as part of any kind of legal action to get their money back ? Other than that I see no down side to not paying these any more .

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Patty, I can’t tell you what to do, but as for the secured debt versus the unsecured debt, there is a reason why credit cards are classified as “unsecured debt.” The lender knows there is no collateral to back up the loan, which is why the interest rates are higher (to offset their losses).

      • http://www.twitter.com/bwfeldman Benjamin Feldman

        Also, as a quick follow-up, here are some resources that might help you with debt collectors and understanding your rights:
        blog.readyforzero.com/how-to-deal-with-debt-collectors-legally-law/
        blog.readyforzero.com/resources/credit-card-debt/

  • Jesse

    We are buried in credit card debt, approximately 15,000. I have been in a custody battle in court for the past year, which is the reason for our debt. Our monthly minimum fees are killing us and are barely getting by because of them. If I stop paying my cards what is the likelihood of getting sued by collection agencies? Are these grounds for filing bankruptcy?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Jesse, I’m sorry to hear about this situation – it must be very frustrating. It sounds like you could use some personal, specific advice, which I’m not able to give. You could talk to a trustworthy bankruptcy attorney (in most cases they will do an initial consultation for free) and ask them what they recommend. Either way, I hope you are able to find the best path for you and your family. Good luck!

  • primo

    help i bought a laptop from the mac store and u bought it with a credit card i couldn’t pay due to me breaking my arm and now its been lver a year they say i owe 2,800 $ and i cnt pay it off because i have no spare money now they gave the debt to debt collectors what should i do? should i save the money and pay it off at once or pay off a bit every month ? what happens if i just dont pay ? help me please im 21 and live in ny

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hey, I’m sorry to hear about that. It must be frustrating! First of all, here are some tips on how to deal with debt collectors:

      http://blog.readyforzero.com/how-to-deal-with-debt-collectors-legally-law/

      As to your other questions, it really depends on what you think will work best for you. If you can afford to make payments every month, that could be a good option. The consequences of not paying will vary on a case by case basis, but you can definitely count on your credit score being damaged in that scenario.

      Let us know if you have further questions!

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  • mrs jane

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  • Eson Hay

    Hi! My name is Eson, 26 years old, and I want to ask some questions about my credit card debts. I have probably more than 4 credit cards and I owe around 8k dollars… I was good at paying my monthly dues for the last few years and never had any late or missed payments.. But now I am really struggling financially because I just started my nursing school and this program requires a lot of time to study. That means less time for me to work and earn money. I’m barely surviving with all my bills, but I really do not want to give up my schooling. So since I cant give up my schooling to work more hours, I am not able to pay at least 3 of my credit cards with at least 6 thousand dollars balance all together. I want to know if I am going to get sued or get arrested, or something. Is there someone gonna be knocking on my door? Am I gonna get a letter stating I will need to attend a court? Do I need to do bankruptcy? I am aware of along the way situation after not making my dues. But I really don’t have any choice and no family to help me out. My School is my only ACE card I can use for my future. I need an advice.. pleaseeeeee.. thank you

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi Eson, I’m sorry to hear about that. My main advice would be to talk to a financial counselor or bankruptcy attorney to get some professional advice on how to handle this financial situation. In the meantime, we have some good resources that I think you will find helpful:

      http://blog.readyforzero.com/ways-to-get-out-of-debt/

      blog.readyforzero.com/resources/credit-card-debt/

      As for your question about being sued, a lender usually has the option of suing you to recoup the debt you owe. However, a more likely scenario is that they will sell your debt to a collections agency, in which case you may start to receive lots of calls from them. If your lender did decide to sue and was successful in getting a judgment against you, then they could potentially garnish your wages.

      Anyway, hope that helps. And good luck!

  • tenn67

    I have been in a chapter 13 for several years, all that is left to pay is credit card debt. When I work I make good money but when I am in between jobs I can not make the weekly payment. I am considering letting the case get dismissed. What will happen if the case gets dismissed?

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi, my understanding is that if a Chapter 13 bankruptcy is dismissed then it is considered void, which means creditors can start coming back for any debts you owe (just like before you filed for bankruptcy). Keep in mind, I’m not a lawyer, so I’d advise you to do some more research and talk to an expert before making any decisions. Good luck!

  • Personal Bankruptcy

    If credit cards haven’t paid off in the future application will be problems because you cannot open another account unless the past credits were paid. That will be a record and it really affect on you.

  • daystar

    Hi friend … I’m not sure there’s any advice or any way out of my situation- but maybe you can give me some idea of what to expect … I’m 65 years old- living only on small soc sec and luckily have medicare and medicaid and some food stamps … – not really any other income or chance of income … My social security does however cover my rent and car payment …. I’ve never missed one payment in my lifetime- never been late for any payment …. for years now I’ve just been paying the minimums of substantial credit card debt with my savings … but my savings are gone and I can make maybe one or two more payments …and then I’m done … I’m financing a car … and even need to use my credit cards for a fill up …. when I soon just stop paying and have only my soc sec income- can creditors take those payments from their direct deposit… will banks close my accounts …. I understand not much hope – but if there is any you could give me I’d be grateful …. thanks …

  • HD

    I live in CA. & towards the end of 2009 I stopped making payments to a credit card. It showed up on my credit report approximately 6 months ago still leaving me with a credit score of 712. Today I looked at my credit reports from Transunion, Experian, & Equifax and none of the reports showed any of this debt and my score is now 789. I was trying to remember the last date I made payment without trying to contact the company lest I restart the timeframe for statute of limitations of 4 years. I believe I last made payment in November 2009 making this year the 4th year. Previously, I had looked at my credit report to see this date, but today I was trying to reference the date but it seems to completely have disappeared. I recently had someone try to contact me regarding this debt, but I did not acknowledge it in any way. I am trying to find this date ( that I last made payment ) to empower myself with info, about limitations. Is there a place I can find this date? Any info. is welcomed and appreciated! Thanks!

    • http://www.twitter.com/bwfeldman Benjamin Feldman

      Hi HD, the only place I know of is on your credit reports, but it sounds like you’ve already looked there. The good news for you is that if it’s not showing up on your credit reports, then it is not hurting your credit score. I’m sorry I can’t be of more help!

  • Vicky

    Hi Ben,

    In march I made payment of $1200 and I thought I paid the balances. I mostly use other credit card which is from other company, But I called credit card company two days ago regarding the credit card limit, then i come to know I had balance left from march of about $400 and there was no payment made after march 2014. I shocked and immediately paid $450 whatever was the amount. Representative said company cancelled my card just 3 days ago. I am so depressed. I just had visa with that company due to which i had no access to online accounts. My fault is I moved a lot during the year and didn’t update the paper bill address. What should I do? I will appreciate your response.

    Thanks

  • Runner2011

    We’ll I just got an American Express blue cash card & I spent $1, 876 dollars plus I pay rent so now I must figure out how I’m going to make the payment I’m worried I may get behind a for a few weeks & I’m only 21. Any hints or tips?