Results of running away with credit card debts

Couple of months ago, some jerks said they would run away back to China. As a veteran in credit industry, here are the consequence they may face: nothing.

Disclaim: I don't guarantee that the following information is correct. If you default your debt and end up in jail, you are on your own :)




In the credit card industry, such behavior is called charge-off. The credit card companies can do nothing if you run away with your debts. Here is the process:

1. when you past the payment due day, the account becomes delinquency. They charge you late fee, raise your interest, stop your card authorization.

2. After 90 - 120 days delinquency, they call the account charge-off, it is sent to collection agency. They will call you and send mail to you to collect money.

3. After the a few months of in house collection, the debts will be marked as bad debts, then it will be sold. They may get 10 to 20 cents for 1 dollar of bad debts.

4. outside collectors will buy the debts, they will continue to collect.

5. unless the loan is very big, they will just let it charge-off because the legal fee is even more expensive.

6. Even they go ahead to sue you, and the court order you to pay. When you declare bankruptcy, they can do nothing.

What you lose:
1. Bad credit record, the delinquency will stay about 2 years. Collection will stay much longer time. Bankruptcy will stay about 7-10 years. So you may never get chance to get a loan or mortgage. Most companies also check your credit when you apply a job. I don't think people like those jerks who ran away with credit card debts.

2. I do believe most of us worth more than a few thousand bucks. If you think you are so cheap and you just want to disgrace yourself for a few thousand dollar credit card debts, I have no comment.