Fortunately, your home is safe from any creditors who do not have a mortgage or lien on it. Credit card companies and other unsecured loan holders can't come and simply take your property or home after missing a few payments. A creditor will first start making collection attempts by mail, phone calls or other methods.
Credit card debt is unsecured debt. In order to lose your home, several things would have to happen. First, you would have to be sued in court and lose. If that were to happen your creditors would receive a judgment against you ordering you to pay.
The goal of credit card lawsuits is to strengthen the lender's collection position. Once an unsecured creditor obtains a judgment, they can then attach your non-exempt property in satisfaction of past-due debts.
TL;DR (Too Long; Didn't Read) If you fail to pay your credit card bill and the creditor charges off the debt, they can legally sue you, issue a default judgment, garnish your wages, or even put a lien or levy against your personal property.
The short answer to this question is No. The Bill of Rights (Art. III, Sec. 20 ) of the 1987 Charter expressly states that "No person shall be imprisoned for debt..." This is true for credit card debts as well as other personal debts.
When you stop making credit card payments, you could not only be charged late fees and higher penalty interest rates but also take a hit on your credit. If your unpaid balance lingers for too long, your account may go to collections, and you could be served with a debt collection lawsuit.
Credit card companies sue for non-payment in about 15% of collection cases. Usually debt holders only have to worry about lawsuits if their accounts become 180-days past due and charge off, or default.
A judgment gives the creditor the right to use additional collection methods to collect the debt owed to them. For example, if the credit card company proves to the court that you owe $5,000, a court may enter a judgment saying that you owe $5,000 (plus costs and interest).
WHY CAN THE SHERIFF SEIZE MY GOODS? If a person or business you owe money to has a court judgment against you, that person or business (then called the “judgment creditor”) has the option of getting an order from the court to seize your goods to pay the debt you owe.
Unpaid credit card debt will drop off an individual's credit report after 7 years, meaning late payments associated with the unpaid debt will no longer affect the person's credit score.
In California, the statute of limitations for consumer debt is four years. This means a creditor can't prevail in court after four years have passed, making the debt essentially uncollectable.
If the credit card company wins a judgment against you, it can take steps to get money directly from your bank accounts. In fact, a creditor could potentially take all that you owe from your bank account.
Ignoring or avoiding the debt collector may cause the debt collector to use other methods to try to collect the debt, including a lawsuit against you. If you are unable to come to an agreement with a debt collector, you may want to contact an attorney who can provide you with legal advice about your situation.
YES. Debt collectors can show up IN PERSON where you live. But FEDERAL LAW says they can't do any of this… Force you to open the door.
Under the Fair Credit Reporting Act, debts can appear on your credit report generally for seven years and in a few cases, longer than that. Under state laws, if you are sued about a debt, and the debt is too old, you may have a defense to the lawsuit.
The first step to stopping debt collectors from calling you is telling them the 11-word phrase - “Please cease and desist all calls and contact with me, immediately.”
You could end up with a debt collection lawsuit and a judgment if you don't pay your credit card bill over time.
A statute of limitations is a law that tells you how long someone has to sue you. In California, most credit card companies and their debt collectors have only four years to do so. Once that period elapses, the credit card company or collector loses its right to file a lawsuit against you.
Failure to pay credit card debt is not a crime in the United States. The US have debunked debt imprisonment in the 1950's which decriminalized the act.
Typically, a creditor will agree to accept 40% to 50% of the debt you owe, although it could be as much as 80%, depending on whether you're dealing with a debt collector or the original creditor. In either case, your first lump-sum offer should be well below the 40% to 50% range to provide some room for negotiation.
If you realize you might not be able to make the minimum payment on your credit card, call your issuer. The sooner you do this, the better. Many issuers offer hardship programs to those facing short-term money challenges — say, because of a natural disaster, family emergency or a pay cut.
Conclusion. If you don't pay a collection agency, the agency will send the matter back to the original creditor unless the collection agency owns the debt. If the collection agency owns the debt, they may send the matter to another collection agency. Often, the collection agency or the original creditor will sue you.