Can Credit Card Companies Sue Me?

Overview

Can credit card companies sue? What can you do to avoid being sued?

Credit Card Company Tactics

Most people have been late a month or two on a credit card payment---it happens to the best of us. You probably have all received daily phone calls from the credit card company asking where the payment is. Normally they will stick you with some pretty hefty late fees ranging from $25 to $60 (as of 2009). The company will bombard you with phone calls until you make payment. They may threaten you with everything from suing you to seizing your home and garnishing your wages. But, legally, what can they really do? The credit card company can sue an individual, but it is rare.

Creditors

If you default on your credit card payment, you will be called repeatedly by the company looking for payment. These phone calls can not only be annoying but they can be scary. Once you pass a certain amount of time without paying your credit card the debt will go to a collection company. All credit card companies are different when it comes to the timeline of how long they will wait to get paid. If you think the credit card company calling is scary, getting a call from the collection agency is even scarier. They will call your home, work and cell phone night and day. They will demean you and try to force you to give them checking account numbers where they can get a hold of your money and pay off the debt.

Creditors Part 2

Normally, credit card companies do not sue. It's not worth it to them. It would cost the credit card companies more to take you to court than it would to hand of the debt to a collection agency. If your debt is minimal to them, they will keep the creditor after you. After a while of dodging the creditor, your credit history will reflect that a debt went to collections. This can harm your credit score for many years.

Credit Help

If you feel that you are on the brink of not being able to pay your credit cards, there is help available. There are many not-for-profit agencies that will try and help you get back on track. One source for good credit information is the Consumer Credit Counseling Agency (see Resources). Remember, it is always best to seek help when you feel that you may not be able to pay your bills. Ignoring it will not make it go away.

Educate Yourself

If you really are concerned about what type of tactics your specific credit card company takes, call them and ask them. If you know you are going to be late on a payment, call them and let them know. Sometimes they will work with you to help you get out of the situation. They don't make money unless you pay them, so they will work with you to avoid legal action.

Can Credit Card Companies Sue Me? by allbettercredit.com