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Well, it happened. After 23 years of my life being debt free, I racked up like 15,000 in credit card debt before the age of 25.
I am unemployed, and don't know when I'll have a job or how little it will pay. I'm sure half of my paycheck each month will go towards rent, and the other half towards food. So I won't have the ability to pay back the debt, like ever. Unless inflation really kicks in big time.
I have still made minimum payments to all like 8 of my credit cards. Never had a late payment, but I am almost broke now and no job.
What are my options?
Should I just say screw it and not even pay minimum payments anymore?
What is the worst that could happen to me for not making any payments to any of them again?
Correct me if I'm wrong but what I think would happen is that -
1. I'd not be able to get any new credit for at least 5 years.
2. I may not get hired for a job if they only hire people with good to great credit.
3. Get a lot of annoying letters and phone calls.
4. I may get sued.
What would happen if I got sued? From what I understand they might be able to take money from a bank account if I have any money in one? Or they might be able to take so much from my paycheck each time? But if I make so little, will they even be able to take anything from a paycheck? Is there a max % in the US that they could take from each paycheck? Like 25% or 40%?
Any other consequences?
Edit : I forgot an Important detail. I'm only expecting to make like 20-28 thousand a year once I get a job. So this isn't a small amount of debt for me like it might be for others.
Last edited by midnight12am; 09-27-2013 at 02:41 AM..
Location: 23.7 million to 162 million miles North of Venus
23,942 posts, read 12,739,023 times
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Quote:
Originally Posted by midnight12am
Well, it happened. After 23 years of my life being debt free, I racked up like 15,000 in credit card debt before the age of 25.
I am unemployed, and don't know when I'll have a job or how little it will pay. I'm sure half of my paycheck each month will go towards rent, and the other half towards food. So I won't have the ability to pay back the debt, like ever. Unless inflation really kicks in big time.
I have still made minimum payments to all like 8 of my credit cards. Never had a late payment, but I am almost broke now and no job.
What are my options?
Should I just say screw it and not even pay minimum payments anymore?
That's something you need to decide on your own.
What is the worst that could happen to me for not making any payments to any of them again?
Correct me if I'm wrong but what I think would happen is that -
1. I'd not be able to get any new credit for at least 5 years.
You probably could, but it wouldn't be worth it. If you default on your current cards then the only creditors that 'might' deal with you in the first few years would be predatory subprime lenders, and they will sock you with sky high fees and interest. You might get something like a $300 credit limit, but, they will throw their non-refundable fees on to the card and those fees will almost max out the card. Then they will continue to charge you a monthly or yearly fee, or both.
2. I may not get hired for a job if they only hire people with good to great credit.
That depends on your state. Some states do not allow a credit check for employment, some states allow it but on a restrictive basis - where you'd be working with money, etc., and some states allow credit checks. To find out if your state allows credit checks for employment you might contact your State Dept. of Labor and ask ... http://www.dol.gov/dol/location.htm
3. Get a lot of annoying letters and phone calls.
You can count on that.
4. I may get sued.
It's possible.
What would happen if I got sued? From what I understand they might be able to take money from a bank account if I have any money in one? Or they might be able to take so much from my paycheck each time? But if I make so little, will they even be able to take anything from a paycheck? Is there a max % in the US that they could take from each paycheck? Like 25% or 40%?
If they sue and win then they can levy your bank account. If you think you might be sued then you should consider living a cash only lifestyle, by not keeping funds in your bank account and using cash or money orders to pay your bills.
Whether they can garnish your wages or not depends on your state. Some states allow it and others don't. If your state allows wage garnishment then the amount that they can garnish depends on your states laws.
If you live in a state that allows wage garnishment and you don't make much money then you can file a hardship exemption with the court. You will have to prove to the court that you only make enough to cover the basic necessities.
Any other consequences? You might check to see if your state is a "pocket service" state. In those states they can freeze your bank account and begin garnishment actions before they even file a suit in court.
If your checking/savings account is with a credit union or state chartered bank, and you have a credit card with them, then if you default on the card they may be able to attach the funds you have in your banking accounts to recoup as much of the defaulted amount that they can ... you would have to read your banks Terms & Conditions and contracts, for your bank accounts and credit cards, to see if they can do that. If it's not in the T&C or in your contract then they cannot attach the funds.
Edit : I forgot an Important detail. I'm only expecting to make like 20-28 thousand a year once I get a job. So this isn't a small amount of debt for me like it might be for others.
If you make up to $28k a year then make a strict budget and stick to it, maybe even get a roommate and/or a second job. Once you get a job you may be able to work out a hardship arraignment with the creditors to get your interest lowered, your payments lowered and some/all fees waived.
Quote:
Originally Posted by NJBest
Step .5: Call them and renegotiate your terms. Best case scenario is it helps you out a little until you get a job. Worst case, not so much.
I won't even comment on how you should be responsible for all the charges you placed on your card. Having 8 credit cards - you knew full well what you were getting into.
You should find a way to pay. Don't even think about defaulting. Good luck.
I won't even comment on how you should be responsible for all the charges you placed on your card. Having 8 credit cards - you knew full well what you were getting into.
You should find a way to pay. Don't even think about defaulting. Good luck.
I gave up on trying to be a "moral" person a few years ago. It wasn't working well for me.
And I don't see how any big bank I'm with would be considered 'moral' now a days either. I see how they treat their employees and their customers. And I'm not a big fan of their sweet relationship with gov't to bail them out , make laws and regulations to destroy their competitors, and pretty much make this country a ****ty place to work in.
I gave up on trying to be a "moral" person a few years ago. It wasn't working well for me.
And I don't see how any big bank I'm with would be considered 'moral' now a days either. I see how they treat their employees and their customers. And I'm not a big fan of their sweet relationship with gov't to bail them out , make laws and regulations to destroy their competitors, and pretty much make this country a ****ty place to work in.
Regardless of what you decide to do with your debt, you should change your attitude ASAP. Making excuses for yourself based on how banks are immoral will not help you in life. So far you borrowed 15K from them without a way of repaying, not the other way around. And if you were making 28K before becoming unemployed while accumulating 15k in credit card debt, unemployment is not what put you in this situation - overspending did.
I gave up on trying to be a "moral" person a few years ago. It wasn't working well for me.
And I don't see how any big bank I'm with would be considered 'moral' now a days either. I see how they treat their employees and their customers. And I'm not a big fan of their sweet relationship with gov't to bail them out , make laws and regulations to destroy their competitors, and pretty much make this country a ****ty place to work in.
You spent someone else's ****in' money...at least make some sort of effort to pay it back!
I gave up on trying to be a "moral" person a few years ago. It wasn't working well for me.
And I don't see how any big bank I'm with would be considered 'moral' now a days either. I see how they treat their employees and their customers. And I'm not a big fan of their sweet relationship with gov't to bail them out , make laws and regulations to destroy their competitors, and pretty much make this country a ****ty place to work in.
What you are doing now isnt working for you either.
$15,000 is not a lot of money. Either get one reasonably well paying job, or get a PT job on top of your day job. Then pay off your debt
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