# Consequences of not ever paying back CC debt



## marfsmal (15 Jun 2011)

First off I'd like to say that I am not planning to default on my credit card debt and have been and am paying it off and have learned my lesson.

But, if I did decide to just not pay them back, what are the repercussions? Say on a debt of 7k.

Would it be just a load of calls from the credit agencies, or would a spell in jail be involved?

Again I'm just really curious as to what happens. I am killing myself to make payments and become debt free so this is just a question.

Cheers.


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## elcato (15 Jun 2011)

It would be lots of threatening letters followed by a court appearance which may or may not result in you going to jail BUT I believe they are trying/have succeeded in outlawing jail. Strangely, you may be better off going into arrears in order to get them to stop charging you interest and give you a chance to pay it back without interest penalties. If you ignore approaches and effectively make no effort to pay it back then your risk of jail is higher. If you have inome or property they may or may not try to get a judgement baszed on that information.


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## marfsmal (15 Jun 2011)

Would it not then make more sense for say people in their 40s, etc. who have high credit card debt, who have no assets, and who have decided they never want to borrow again for a house/car to just default?

There is a case for it really isn't there, given the sinful rates of variable interest (and rising) on credit cards and given what the financial institutions have effectively caused to happen to this country.

I'm in my late 20s, and my debt is 8k while I have car worth 3500 so I'm just as well off paying back mine, but for someone older, like the example above, if I were them I would walk away I have to say.


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## mf1 (15 Jun 2011)

Two perspectives

1. 
"There is a case for it really isn't there, given the sinful rates of variable interest (and rising) on credit cards and given what the financial institutions have effectively caused to happen to this country."

Justification of reasons for not repaying debt willingly and happily incurred. 

2. 

Borrowed money. Must/should repay. Honour. Ethics. Moral. Right and wrong.
Ruined credit rating. Judgment published. Court appearanceas. Attachment of earnings.  Common knowledge that X does not pay debts. Would you lend to this person? Scruples. 


If ethics does'nt do it, consider the prospects of needing to raise finance urgently to pay for medical care, nursing home care, essential house repairs? Who would lend to someone who defaults?


mf


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## Greta (15 Jun 2011)

There is no jail for a civil matter like non-payment of debt! Unless the debt is owed to the government maybe, e.g. large tax arrears. In the UK you can go to jail for non-payment of council tax.

But no jail for credit card debt unless you incurred it fraudulently, say, in someone else's name etc, which I presume isn't the case. But then the jail would be for fraud, not for the debt itself.


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## Jim2007 (15 Jun 2011)

marfsmal said:


> I'm in my late 20s, and my debt is 8k while I have car worth 3500 so I'm just as well off paying back mine, but for someone older, like the example above, if I were them I would walk away I have to say.



Well these kind of debts eventually get factored out to a debt collection company, who are usually much more motivated to see that the debt is collected, since that is their business. This may eventually lead to a judgement against you, which the debt collector will seek to enforce.  Meaning that the County Registrar or Sheriff will be instructed to take the property of the debtor and sell it at auction.  [broken link removed].  Note that the Sheriff can keeping coming back until he gets it all!

Jim.


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## marfsmal (15 Jun 2011)

Very interesting Jim. So even for debt of 7k a debt collection agency can take a judgement against you and seize your assets? Wow. 

I have to say it's disgraceful that they can publish your name for a court appearance. Same with those getting caught without tax discs, etc. Seriously with the levels of white collar crime as they are and most of these people virtually anonymous this really is a-wall.


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## peteb (15 Jun 2011)

Name and shame! why not?


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## mf1 (15 Jun 2011)

"So even for debt of 7k a debt collection agency can take a judgement against you and seize your assets? Wow. I have to say it's disgraceful that they can publish your name for a court appearance."

The money is due. Which bit of that is not obvious? Why do you think there should be a moral police man deciding that the debt /judgment should not be published  because you believe there are others more deserving? 

Wanders off shaking head in disbelief.....................

mf


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## Bronte (16 Jun 2011)

marfsmal said:


> and have learned my lesson.
> 
> 
> 
> ...


 
This is not directed as you in particular but one does wonder what way people are brought up.  If you borrow money you should pay it back.  If you make a mistake in borrowing money you should pay it back.  If you were silly and borrowed money you should pay it back.  Quite simple really.  

Learn your lesson, pay it back and move on and don't make a mistake in borrowing the next time.


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## scarednow (16 Jun 2011)

Dont comment too often, but feel a need here. With the rises in petrol (large % of which is tax, in turn paying back banking bail out), income tax (personal monthly income reduced by over 130 euro per month over the last 12 months (incidentally this is the interest portion of my own personal credit card debt), I really think that if the OP wants to walk away from his CC debt (which he states IS NOT his / her intention), and in turn negotiates either no interest or lower monthly repayments, then power to OP.
Its not about the way you are brought up Bronte, YOU do not know every member on this site and have a nerve to question someones upbringing. Here is a scenario you have a sick child who, due to another unbelievable expense in this poorly run country, costs 60 eur to go to the doctors, do you a) make sure you pay back your CC debt or b) take the child to the doctor and with prescription use that money to ensure your child gets better - in your opinion, does the way you were brought up determine this ? Some people are too obsessed with money!!


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## mf1 (16 Jun 2011)

"Its not about the way you are brought up Bronte, YOU do not know every member on this site and have a nerve to question someones upbringing. "

Emotional attack and evasion of the issue. 

Read these two sentences: 

A. What's the worst that  can happen to me of I opt not to repay my credit  card debt? 

versus

B. I am in financial difficulties and need some help managing my credit card debt. 

Very different scenarios.

mf


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## legend (16 Jun 2011)

listen walk away from it, health is welath, i know for a fact that cc debts at this level are not pursued by banks once they send a few threatening letters etc. they have bigger fish to fry


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## mf1 (16 Jun 2011)

legend said:


> listen walk away from it, health is welath, i know for a fact that cc debts at this level are not pursued by banks once they send a few threatening letters etc. they have bigger fish to fry



Dreadful, dreadful advice, worthy only of bar stool barfly! 

mf


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## marfsmal (16 Jun 2011)

Bronte said:


> This is not directed as you in particular but one does wonder what way people are brought up.  If you borrow money you should pay it back.  If you make a mistake in borrowing money you should pay it back.  If you were silly and borrowed money you should pay it back.  Quite simple really.
> 
> Learn your lesson, pay it back and move on and don't make a mistake in borrowing the next time.



Why quote me then? I already told you I am posing a hypothetical question. I have and always will pay back my debts. Don't patronise or bore us with the lectures.


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## marfsmal (16 Jun 2011)

Seriously before anyone else gets on a moral high stool here this was a hypothetical question which I thought I clearly stated in my opening post.

I would appreciate replies back from posters like Jim2007 and Greta who have addressed the question and didn't take any moral high ground.

(p.s for further evidence look at my post history - I have asked for advice in the past for paying back debt. Let's say it one more time - this is HYPOTHETICAL.)


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## mf1 (16 Jun 2011)

I see some of the posters here have made the fatal mistake of choosing not to only answer the "specific" question answered but have made the unforgiveable sin of straying into assocated relevancies. 

I think the Posting Guidelines should be amended so that all posters who reply to any post are prohibited from straying beyond the "specific" remit of the question posed. And OP should be able to only read/choose posts that they like. Every one else should be deleted. So that we have a well rounded view of the world according only to those people who offer the answers that posters want to hear. 


"Don't patronise or bore us with the lectures. "

Did'nt Bronte say: 

"This is not directed at you in particular but one does wonder what way people are brought up."

mf


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## marfsmal (17 Jun 2011)

Didn't she also say

'*If you were silly and borrowed money you should pay it back.  Quite simple really.  

Learn your lesson, pay it back and move on and don't make a mistake in borrowing the next time'* 

Even if it was a general remark, it wasn't useful whatsoever.

Again see Jim2007's post for an example of a very helpful post. Maybe he's a bit less insecure in himself and doesn't need to lecture like others do.

Just a thought (not directed at anyone in particular )


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## Bronte (17 Jun 2011)

marfsmal said:


> , but for someone older, like the example above, if I were them I would walk away I have to say.


 
Is this too hypothetical?

Sorry if it appeared I was lecturing, can't help it being the eldest, it's the nature of the beast.  My remarks are based on the many people who come on AAM with 'hypothetical' questions such as yours.  

Scarednow - you belive that the OP wishes to walk away from his debts, and that's a good thing.  Why is that a good thing?


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## marfsmal (19 Jun 2011)

I am female.

Yes. If I were 40+ ( those unlucky enough to have been in their late 20s and thirties during the boom) and had substantial CC debts (accumulated during the bubble) and was spending most of my income on the repayments of even only the minimum amount, I would not waste the next few years of my life paying it back. I would save and invest it. 

This is in the context of the bailout of the banks and the economic bubble. 

If the circumstances were different I would not be necessarily advising this age-group (and above scenario) to walk from the debt.

I have my thirties to invest, lessons learned about borrowing which like I said in my first post, won't be happening again.

Sadly empathy is always in short supply in the human beast.


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## Jim2007 (19 Jun 2011)

marfsmal said:


> Very interesting Jim. So even for debt of 7k a debt collection agency can take a judgement against you and seize your assets? Wow.



Well a debt collection agency has more motivation than a bank to collect as that is the only way they make money.  Lets take the 7K example, if they buy that of the bank for say 2K, then if they fail to collect they have lost real money... and if this happens too often they'll go out of business hence the big motivation factor.

But of course having said that it all depends on what the bank decides to do in the individual case.  But it is important to remember that just because a bank says it has written the debt off that does not mean that the debt has died, it just means they have taken it off their books.  They could still decide to pass it on to a collection agency.

Jim.


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## Jim2007 (19 Jun 2011)

marfsmal said:


> Again see Jim2007's post for an example of a very helpful post. Maybe he's a bit less insecure in himself and doesn't need to lecture like others do.



Thanks!  But in a past life I spent about 5 years working in the insolvency department of one of large accounting firms, so I've seem more that my share of people in financial difficulty...

In many case I put financial difficulties down to a failing in the education system (and not just Ireland).  We don't educate people in how to manage their money and yet it is as fundamental a skill as reading or writing!

Jim


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## mmclo (20 Jun 2011)

I think there are other threads here and elsewhere about debt collection agencies, basically it's all a ball of smoke they have no specific powers over and above the ordinary punter. In fact if you tell them to go away and they don't they are almost commiting an offence. 

The lender however still has all the powers to bring you to court and get their money. Agian I believe "selling on" debt is very rare in Ireland despite the language the agencies use which gives the impression this has happened when it hasn't 

http://www.askaboutmoney.com/showthread.php?t=146970


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## marfsmal (20 Jun 2011)

Thankfully the 8k I have on credit cards was incurred because of travelling and a career change\study in the main.. it's debt I've both built up and continued to roll over for 6 years and which I am now eradicating altogether.

I would be down to 3k -3.5k now only that my car broke down and due to where I live and other reasons I had to buy a new one. I opted to invest in an 03 and spend 3.8k rather than a 1k car which could have broken down at any time and left me back to square one. So while it cost me I will keep it until at least 2016 or as long as possible so it was a long term investment. It's also one that is easy on petrol, low on tax etc. so I don't regret it. The loan for it will be paid off in 2 months and that monthly amount I had to pay on the car loan will be going straight to my credit card debt thereafter.

I guess not all credit card debt is equal. I didn't spend it on clothes, fancy meals, and cappucinos, etc. I travelled and saw some of the world, and sustained a change in career and am almost qualified for my chosen field where there are job opportunities. So there is a reason my debt level has stayed at that 8k figure, but in 12 months good luck to it 

Definitely agree with you Jim, and thanks to mrderp re. info about the 'debt school', it's a great idea. Would be useful to all categories of borrowers, from the bottom up. Eddie Hobbs was the only person who really made people think about personal finance in this country to any extent.


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## Complainer (20 Jun 2011)

Greta said:


> There is no jail for a civil matter like non-payment of debt!


In general, this is true - but there have been some cases where people have gone to jail. There was one famous case of a guy down wesht who was evicted and later jailed following proceedings by Irish Nationwide and Michael Fingleton. There was one lady on Eddie Hobbs TV 'Show me the money' series who's credit union had started commital proceedings against her.


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## 44brendan (20 Jun 2011)

Commital proceedings can only be progressed when a person has failed to comply with the terms of an Installment Order set by the Court. In effect the failure is a breach of a "Court Order" and the financial institution could progress for a committal order on foot of this breach. In practise they are now extremely rare and can be easily avoided by either talking to the Institution or going back to the Court to plead inability to pay.


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## legend (21 Jun 2011)

im actually speaking from exp.... had a cc debt couldnt pay att he time, loads of letters threatening to this and that... nothing came of it, its a bad debt, 6k..... i'm suprised at some folks on here that i thought were knowledgable when it came to money matters there's always right off's and bad debt....


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## cazmayo (21 Jun 2011)

*Car Finance - Half Way Rule*

a.....


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## Bronte (22 Jun 2011)

legend said:


> im actually speaking from exp.... had a cc debt couldnt pay att he time, loads of letters threatening to this and that... nothing came of it, its a bad debt, 6k..... i'm suprised at some folks on here that i thought were knowledgable when it came to money matters there's always right off's and bad debt....


 

A bank will only write off bad debt if there is no mark.  You must have had no assets no income etc and that's why they wrote it off.  Pointless pursing someone who has nothing.  I know of people who've had debt written off, but it's only in the case where there is nothing to be gained in pursing that person.


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