Small Credit Card Debts Could be Accumulated to Form a Big Debt Snowball
Credit card debt is an example of an unsecured debt which is accessed through credit cards when a client of the credit card company buys anything or acquires any other services. The amount of debt keeps on accumulating and the interest rates keeps on increasing. Huge penalties will be taken if the money is not paid in time.
Ways to Pay Heavy Credit Card Debts
Now how to pay the credit card debts? The credit card debts can be paid by negotiating with the credit card companies or can be paid through installments. If the debt is paid in regular monthly installments then the debt gets paid up in its due time but the condition is that no new debts are made. If the regular installments are not paid then the interest calculate over that amount makes total payable amount huge.
Credit card debts can be negotiated with the lender. If you think that it is impossible for you to pay the debt amount, you may talk to the lender, he will definitely bring out some options. He may either lessen the amount to be paid in per installment for the total amount due (less likely) or may waive some extra charges for the net amount. All these negotiations should be written and not verbal. Because according to law verbal communication is not considered as a legal binding, so it should be written and signed.
These things can be very irritating because when it comes to lessening the amount the credit card companies can turn deaf to your request, but you have to be patient. The credit company while writing the agreement keep a clause that the amount has to be paid in full. So to lessen the amount the borrower has to be calm and patient. All the negotiating documents should be done in writing and should be kept carefully so that it can be produced when needed. In case of legal proceedings these written notes act as a proof that you are willing to pay back the loan and have done necessary things for that.
Beware of Legal Actions if you Ignore the Credit Loan
Credit card debt is an unsecured debt so if the amount is not paid in full, the credit card companies can sue you for it. It always depends on the credit card companies, some companies may keep on adding the amount and then charge you a huge amount. They may also give you some time to repay but it would only increases the interest rates on the amount due at the same time. When this outstanding amount becomes huge they ask for payment which then becomes a burden for the borrower and he may even be sued for it or even lose his property.
If the borrower is unable to pay the amount borrowed then the companies may take up various steps, they may send collectors to collect the money, they may take up legal steps to collect the money or they may even claim your property.
Another question is that, if the borrower dies then what will happen to the loan? If the borrower dies before paying the debt then the loan will not pass on to his or her heir but that will pass on to his property. His property will be claimed by the credit card companies.