What can credit card companies sue me for if I simply stop paying?

[brokeone]

Good Morning everyone,
I previously posted reAm I qualified to file bk 7).I did receive one response,and am grateful.
I have another question.If I simply tell my credit card issuers that I can't afford to pay them,Or hire a lawyer to tell them that for me,and stop making payments,How will they come after me?Will they sue me for what I owe?Will they sue me for my Home?I know my credit rating will take a hit,but I could make it,if I had not screwed myself with credit card debt.Please give me your thoughts.I have not yet missed any payments,but my unsecured personal loans & credit card debt has pushed me near the edge.I need all the advice I can get.If you can find the time to respond,I am thanking you in advance.

brokeone

[HRx]

Depending on the amount of the debt, the creditor(s) can seek legal action to have your wages garnished.

[brokeone]

Thanks Todd,
Does that mean they can sue to garnish my retirement & Social Security? All of my unsecured debt amounts to $40,000.Thanks again.

brokeone

[HHM]

Typically, social security is exempt from garnishment, retirement income might be another issue and will depend. Also, they can levy against your bank accounts and force you to come to court and prove that the money in there is exempt.

But they could also sue you and use the judgment as a lien on your house.

Just file bankruptcy and get the debts discharged, in the long run, its the least costly option.

[brokeone]

Thank you HHM,
I'll set up an appointment with a bk attorney.
brokeone

[Dawn1970]

BrokeOne,
Typically CCs will try harassing by phone for at least 3 months before they'll start any severe collection efforts. And cards that you owe <$2,000 on are less likely to come after your wages b/c it simply isn't worth their time after they pay the legal fees.

[brokeone]

Dawn,
Thanks for taking the time to help me.
brokeone

[rainmand]

I have not yet missed any payments

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If you keep making the payments on time and file chapter 7, your FICO score will drop but you'll still qualify to buy a home with 100% financing the day after the bankruptcy is discharged (if your FICO is at least 600). Your FICO will begin to drop drastically if you begin missing payments and/or have judgements against you because you stopped paying the creditors.

You mentioned retirement income. Are you older than 61? If you are and you have a lot of equity in your house, you might consider a Reverse Mortgage. The Reverse Mortgage can pay off the rest of your house and all of your credit card debt.

[brokeone]

Hello rainmand,
Thanks for helping me.Yes,I am over 61 (and can't believe I got myself into this problem area).Two years ago we tried to resolve some money problems by taking out a home equity line of credit & paid off most of our debts.Of course this freed up the opportunity to buy more stuff & soon we were right back in debt.
I just wish there was some way that I could get the money together to pay off my creditors with one payment,and I'd be out of trouble.What's killing us is paying card #1 $250.00 a month,card #2 $240.00 a month,card # 3 $180.00 a month,and on & on.If I could figure out how to get a $50,000 loan,pay off all my debts,and then make one big payment a month,I'd be home free.I would not have to file bk.thanks again for responding.
brokeone

[mylife05]

Hi brokeone. I'm sorry for your situation. I can empathize and understand.

I wanted to address the $2000 threshhold that was mentioned. Noone should take my word on anything, I'm just passing along my experience. I work at a bank, and am very familiar with garnishments on accounts. Out of curiosity, I pulled a couple of totals from the year 2004, and about 2/3 of all garnishments were under $2000. So yes, there were fewer of them, but they DO happen! So ignoring creditors is NOT a good idea at all, regardless of the amount (but you got that advice already ;) ).

Good luck in figuring out your situation! I know you will.

[brokeone]

Hi mylife05,
Thanks for responding.
brokeone

[clig_fred]

U could fix your situation in no time

Good Morning everyone,
I have not yet missed any payments,but my unsecured personal loans & credit card debt has pushed me near the edge.

My advice is don't file for BK and don't seek CCCS. Since you pay on time, then you are is good standing and must be offered good rate on balance transfers.

So make use of the balance transfer offers. Register online with all the credit card companies to make life easier. Then create an excel spreadsheet or a word document to help you keep track all your transactions. Try to also put all websites to the login page to the credit card companies.

The just keep transferring for 3% Apr from one credit card to another.

Your case is more of a management and planning issue and I feel if you take steps in documenting everything from one place (like an excel spreadsheet or word document), then you will be on your feet in no time.

Stay in touch.

[brokeone]

Hello clig fred,
Thanks for helping me out.I'll discuss this with my wife,and keep you posted.
brokeone

[waziggy]

Anyone else recommend the transferring of credit card debt to newer accounts with lower fix rates? I get offers by the ton everyday and always thought transferring was a no no for your rating?

[brokeone]

Hello waziggy,
I don't get any low fixed rates for balance transfers.I suspect that with all of the mergers taking place I'm not going to find one either.I as a matter of principle would prefer to pay my debts,but believe sooner or later I will have to file bk because I 'm not smart enough to figure out how to get a loan,pay these debts off,and make one payment instead of a bunch like I'm doing now.

brokeone