What Happens if You Do not Pay Your Credit Card Bills?
I wish to digress, once again, from being your Florida D.U.I. Lawyer to that of pundit on the repayment of one's un-secured debt.
I will approach this from the aspect of a Florida Bar Member and citizen of the State of Florida. We all know what is happening in this country with the crisis in the markets brought on by the greed of Wall Street that has been enabled by Republicans and Democrats. You read everyday of the bailouts to corporate America and wonder who will bail you out and where is your relief.
The bills keep coming, and yes, deep down you wish to pay them, but you are in over your head. The credit card companies are calling almost everyday and even though you tell the representative that you were called yesterday there doesn't seem to be any record of that call being made. You are struggling to pay the mortgage and put food on the table. The car is a necessity, so you have to make that payment. But what about the rest?
The basics include food, clothing and shelter. You can even hold off on the clothing, but you need a place to live with your family and you must eat. The car is needed to get to work and elsewhere. So, I say, if you must skip payments then do not pay the credit card debt. Will it hurt your credit record? Yes, it will. In fact there are several commercials on TV right now that make a point of telling you how important your credit is and why you should spend every hard earned nickel to keep it up. I wonder who paid for those commercials?
So what will happen to you, you wonder? First and foremost you cannot go to jail! You may wish to write the company and explain the situation and suggest they reduce the interest rate or even the principal. Will that work? Maybe! It is possible for the credit card company to sue you or even sell the debt to a company that purchases such debt. Hudson and Keyes is one such company. In turn the debt purchaser will write you a letter probably offering to settle for less than what you owe on the account. In the State of Florida there are a number of attorneys who are retained by the debt purchaser to sue on their behalf. They are often authorized to settle for a lot less than what is owed on the debt.
There are defenses to a lawsuit, one of which is that the interest rate charged by the company is usurious. In the State of Florida an interest rate over 18% is usurious. There are many individuals who are paying in excess of 18%.Florida Statute 687.04 provides that the entire interest, if in excess of 18%, can be forfeited and only the principal paid. All states vary and you should check with a lawyer ( I know, how can you pay a lawyer?) in your state.
Another option to consider is a debt reduction firm , such as Consumer Credit Counseling Service. It maybe possible to have the overall debt reduced. The debt reduction company contacts your creditors and works out a deal whereby you would pay less. and perhaps reducing the interest rate. You would still make monthly payments but it would be to the debt reduction firm who would then dole the money out to the creditors.
In any event do not let them hound you into submission! If you have to change your telephone number and have it unlisted.Do not even open the monthly statement, but I suggest you keep it ( it might be a way to show an usurious interest rate).
Should you ever wish to discuss life, the universe, or anything else you may reach me at duitim@floridaduilawyer.com or visit my website at www.floridaduilawyer.com.
Copyright, all rights reserved Timothy Foster, 2008