Can You Legally Stop Paying Credit Cards

It is not considered a crime to stop making payments on your credit cards in the United States. The last time someone was thrown in jail for their debts was back in the 1850′s. But, your creditor can take you to civil court to obtain a judgment against you, which is basically acknowledging that you do indeed owe the debt. From there, legal actions can be taken to collect the debt, as in wage garnishment and liens on any of your assets. It is rare for credit card companies to pursue these drastic measures, but there are many instances where they have because they figured they could get most of their money back.

After the credit card company has a judgment against you, then they need to make another court date so they can actually be assigned a ‘Writ of Execution’, in order to perform collection processes. If you are summoned for this court date, and fail to appear, you will have a bench warrant issued for your arrest, because by not showing up, you were in ‘contempt of court’. You are needed in court to get all the facts laid-out, this is where they get your employment information for garnishment and for asset evaluations for the purpose of liens. Keep in mind, most collections never make it to this point, depending on your circumstances. For instance, say you’re now unemployed and have high medical bills, or are now on disability with a limited income. The Federal Government has a minimum wage per week limitation and if you fall below that, the credit card company may not collect from you.

Credit collectors will try and make you believe it’s illegal to stop making payments, they will even threaten you, because that’s their job. But, there are rules and regulations that collection agencies must follow and you can look these up at the ‘Fair Debt Collection Practices Act.’ If you find they are going above and beyond the regulations, you have the power to file a suit against them. One example of going beyond the regulations is if the collections agency has your phone number, they can not call up your employer, friends or family, but you do have to request they not call anyone but you.

By all means possible, no matter how ugly the collection process can get, make payments towards your debt, even if they say that amount is not enough, send in the payment regardless. Your credit rating will reflect this and not be as bad, plus, you’ll feel better knowing that you are a responsible person.