Mar28
What Lengths can Credit Card Companies go to Recover Debt?
Because credit cards are considered unsecured debt, meaning they are not attached to any assets, many people believe there are no real consequences from failing to pay their credit card debt.
In fact, credit card companies have suffered greatly over the past, few years because credit cards are often the first bills people skip paying if times are tight. Although credit card companies cannot take your home, car or other assets if you fail to pay your credit card bills, they can take a number of actions against you, including:
- They can put pressure on you – The most common form of communication employed by creditors when seeking their payment is the phone. If you fail to pay your credit card payment, you can expect phone calls at your home. In fact, you can expect numerous phone calls throughout the day and into the evening if they can’t get a hold of you. It doesn’t stop there, either, as creditors will likely call all phone numbers they have on file for you, including your cell phone and your work number. Receiving a phone call at work from a creditor can be incredibly embarrassing, and receiving numerous phone calls throughout the day may prove to be quite stressful. Expect to receive phone calls until your payment obligations have been met.
- They can hand your debt over to a collections agency – Once your account has been handed over to a collections agency, expect phone calls and pressure to increase. Debt collection agencies get paid when they collect money, so they have plenty of incentives to get their money.
- They can place a lien on your home – Although a credit card company cannot take your home away from you, they may be able to get a judgment against you and ultimately put a lien on your home. In other words, you won’t be able to sell your home until you have paid off the debt.
- They can garnish your wages – In extreme cases, credit card companies may be able to garnish your wages. If the creditor obtains a judgment against you, they may be able, through the judgment, to garnish your wages until the debt is paid.
If you are experiencing difficulties paying your credit card bills, it is best to contact the credit card company to set up more realistic payment plans or contact a reputable consumer credit counseling agency to help you manage your credit card debt and develop a game plan for paying off the debt.
