Consequences of Unpaid Credit Card Debt

Page content


Many people wonder what happens if you quit paying your credit cards. The reality is that at first, not a lot will change except increased collection calls and letters. But within six months or more of no longer paying your debt, you could be sued by the lender or its collection agency.

First Steps

Right after you quit paying your credit cards, you will receive numerous collection calls. At first they will be somewhat few, and then as each week and month passes without payment, the calls will increase. Remember, if the person calling you is not from a collection agency, they have the right to call you during most hours of the day and night. However, most credit card companies are still respectful and choose to call during the hours of 8 a.m. to 9 p.m. You will also receive letters in the mail about your debt and maybe settlement offers. In addition, late fees and any over-the-limit fees will accrue on your balance in addition to any existing fees and interest rates.

Final Steps

Once 180 days has passed without payment, the credit card company will write your debt off as uncollectable on their taxes. However, this does not stop collections activity. At this point, your account may be sold to an outside collection agency or the lender may get an attorney and sue you for the bill. However, if the balance is not in the thousands of dollars and it seems you have no way to pay the bill, you may not be sued. People with jobs and home ownership are far more likely to be sued because lawsuit proceeds can be deducted from their paychecks through wage garnishment, or a lien can be attached to their house to mandate payment.

Credit Effects

Once your account is 30 days late, your credit will be negatively impacted. Each month it is late, your credit score will become lower. This also applies to as the balance increases due to the late and any other fees assessed to your account. Your cards will likely show “closed by credit grantor” once they are cancelled for non-payment, and when the account charges-off the negative rating will reflect on your credit report. Any lawsuits or collection agency involvement also will be placed on your credit file. Such information remains for 7 years.


There are several alternatives that might be better ideas in the long run than to simply quit paying your credit cards. One is to try to adjust your budget and use a credit card calculator to try to crawl your way out of debt, even if you can’t pay every account. Another choice is to join a program such as Debtors Anonymous and try to change the habits that created the unmanageable credit card debt. You could also file bankruptcy, which would legally absolve you of your debts, or find debt solutions such as credit counseling.