What Happens If I Am Not Paying Credit Card Debt?Higher Interest Rates Charged On credit Cards As you probably guessed already, you will immediately be charged a higher interest rate. Any agreement signed with a credit card company indicates an interest rate that will be charged should you ever default. Once you default, the credit card company is able to lawfully increase your interest rate immediately. Depending on your agreement with the credit card company, your interest rate may also be increased if you default on any other account. Read the fine print in your agreement with your credit card company to be sure.
Credit Card Late Fees Are Assessed As indicated in the agreement you signed with your credit card company, included information regarding specific late fees that would be imposed should you ever default. Once you are in default, late fees will begin to be added to your credit card balance. Collection Phone Calls For Credit Card Debt You can’t default on a credit card without receiving collection phone calls. Typically, within weeks of defaulting on your credit card, you will begin to receive collection calls to determine the status of your ability to pay your credit card payments or balance. With the current state of the economy, credit card companies are much more flexible as to how they work out a payment arrangement with their customers. Some even offer to match payments. Negative Reporting Goes On Your Credit Report Unfortunately, when you default on a credit card the credit card company notifies one or more of the major credit reporting companies of your default. TransUnion, Experian and Equifax are used by all credit letting agencies in obtaining information regarding someone’s creditworthiness. Every time you do not pay a payment, the non-payment is noted on your credit report. Even if you make a payment and the payment is late, the credit card company can legally report that late payment to the credit reporting agencies.
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