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Can Credit Card Companies Take Your House?
Can credit card companies take your house? Secured and unsecured debt are the two main categories of debt.
Secured debt is backed by a valuable asset known as collateral, which the creditor can confiscate if you default on your payments.
However, because unsecured debt isn’t secured by anything, defaulting on your payments doesn’t give the lender ownership of your belongings.
But what about credit card companies and their ability to repossess your home if you default on payments? The majority of credit cards, after all, are unsecured.
If you have financial difficulties and miss several payments, your credit card issuer may try to convert you from an unsecured creditor to a secured creditor with rights to your property in order to recuperate their losses.
Note: Some unsecured credit cards on the market need a deposit equal to the credit line in order to be authorized.
What Does a Credit Card Company Have Power Over?
A lawsuit would have to be filed by the creditor. When you miss your first payment, the creditor will usually start calling you and sending you letters.
Most creditors report delinquencies to the three credit bureaus – Experian, TransUnion, and Equifax – after 30 days.
Once the account has been past due for 120 days, the creditor may write off the balance as a bad debt expense on its books.
This is known as a charge-off, and it can have serious ramifications for your credit score and financial well-being.
Not only will the balance be sold for pennies on the dollar to a collection agency or law firm, but your credit score will suffer as well.
You may also notice an increase in the number of collection calls and letters. The debt collector may threaten you with a lawsuit at some point, especially if you write a cease-and-desist letter asking for all correspondence to be stopped.
If they file a case and you don’t react, the debt collector may be able to obtain a default judgment against you.
This means the court acknowledges you owe the debt and has the authority to confiscate your property in order to collect the amount.
Is your home, however, at risk of a seizure? It is determined by the exemption legislation in your state.
Services for Debt Relief
Exemptions for Homestead – Certain states safeguard customers by prohibiting creditors from seizing property.
Depending on where you live, creditors may be unable to seize the value of your home, car, or other personal property.
Consult a consumer lawyer in your area for additional information on property and other exclusions.
A Creditor Must Collect a Judgment – The reality is that a judgment may require you to sell your house in order to repay creditors. However, the process is complex and time-consuming, which may discourage creditors from pursuing it.
Alternatively, creditors may take the following actions:
Place a Lien on Your Property – When you sell or refinance your house, a judgment lien gives creditors the opportunity to recover their debts.
Garnish Your Wages – The creditor may garnish your wages, which means they will deduct funds from your bank account automatically when you are paid. However, depending on your state, creditors are limited in how much they can take.
Levy your Bank Account – Upon receipt of a judgment against you, certain creditors may levy your bank account. As a result, the bank will block your account and transfer payments to the creditor until the sum is paid in full.
How To Get Debt Relief – If you’ve fallen behind on credit card payments and are concerned that debt collectors will seize your property, try a debt relief program for assistance.
Accredited Debt Relief is an excellent alternative for consolidating credit card debt without jeopardizing your home.
Its credit card debt consolidation program simplifies the process of debt resolution, and you could be debt-free in as little as 12 to 48 months.
Even better, its debt resolution team works directly with creditors to negotiate settlement offers that reduce your balances by up to 50%.
The following provides an outline of how the program operates:
If you owe $10,000 or more on unsecured credit cards, call 800-497-1965 or complete the online form to get a free consultation.
Decide how much money you’ll put each month into a designated savings account. The proceeds will eventually be used to satisfy debts with creditors.
Once you’ve saved a specific amount, the debt resolution negotiators will contact your creditors on your behalf and discuss settlement offers.
If you accept each settlement offer, the monies in your designated savings account will be utilized to resolve the balance.
The process will be repeated until all unsecured credit card bills included in the program are negotiated.
Can Credit Card Companies Take Your House Final Words
Consider contacting credit debt counselor today by filling their online form to begin the process of safeguarding your assets and obtaining the relief you require and deserve.
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