Does Credit Card Debt Go Away? Anyone Know?

[neilgunt]

Hullo. I need help on my debt situation. I total $53k on all my credit card debts and I have just lost my job so I don;t know if I can still be able to pay them, at least anytime soon. i want to know, does credit card debt go away? and how long would it take? i really can't make any payments on it right at the moment and it might take long before i can get a job again. Peace

[dczech09]

How did you rack up this much CC debt? How old is this debt? The only things that will "erase" this debt are the statutes of limitations and/or bankruptcy. Either way your credit will be trashed and you likely will not be able to borrow for a long time to come. Can you sell stuff to pay off? Do you have any assets at all that can be used to pay this down? You need to speak with a qualified credit counselor and a bankruptcy attorney ASAP!

Even if you were pulling in $50,000 a year in income, that $53,000 debt load is extremely high and will crack your cash flow in no time. That amount of CC debt is no laughing matter and needs to be addressed immediately.

You say it may take a while to find a job, which is the wrong mentality to have. Find a part time job SOMEWHERE! I do not care if its McDonalds, you need to take action.

[jpg7n16]

What do you mean "go away"? Like how can you keep everything that $53k bought you can just skip out on paying it back? Or will that amount of debt ever get paid off?

The answers are: yes, but it will destroy your credit to do it (bankruptcy). And yes, but it will take some time (find a new job, pay back what you owe).


You would likely have been sued by the CC company before statute of limitations comes into play. And you owe them $53k, so they have a right to sue you.

[bjl584]

Not sure with that much debt. Unless you try to negotiate you will most likely get sued and have a judgement levied against you. I would focus on how you accumulated that much CC debt. You need to change your lifestyle and the way that you think about money to prevent this from ever happening again.

[swanson719]

After 120 to 180 days of non payment, most credit card debt is sold to debt collection agencies. I don't know about a $50K+ account. Debt collection agencies buy the debt for usually no more than half the debt amount, and very rarely pay that much. So when you are dealing with debt collectors, you should be able to pay 30 cents on the dollar or even less.

Note that when you do settle with a debt collector, the difference between the amount paid and the amount of original debt is forgiven. The forgiven amount - which should be somewhere in the $40K range - would then be counted as taxable income against you. Meaning you pay taxes for that year as if you made $40K more than you really did. Which means that you would owe the IRS a few thousands dollars in taxes.

Best case scenario is that you settle for 30%, so $16K, then pay taxes on $37K forgiven, which if you are unemployed would put you into at least the 15% tax bracket, so taxes of $5,550 minimum. That lets you out for $21,500 from a $53,000 debt. Not a bad day.

Or you can declare bankruptcy, which will trash your credit permanently. People say it doesn't, but I've never filled out finance paperwork that doesn't ask if you've EVER filed bankruptcy.

[agape71]

Credit card debt does not go away on its own just like that. Simply ignoring it would actually lead you to more trouble--you will have to pay interest charges and late fees on top of the loan balance that you have. Another risk in not paying your debt is having bad marks on your credit report. Of course, if the debt becomes delinquent, you may also be contacted by debt collectors, and eventually, be taken to court by creditors. Fortunately you have options in taking care of these credit card debts of yours. You may either opt for debt consolidation or bankruptcy, to make your credit card debt go away. Although I'm personally not too inclined with the bankruptcy option, given that you still have other options available to make your debt go away.

[Seeker]

His past posting has a bit more description:

http://www.savingadvice.com/forums/debt/53530-am-i-right-track.html

This poster has been posting these questions since May, and never responds back to any of his older threads.

Per the above he (and his wife) have 23k of CC debt (which is "mostly" wife's education debt and unsellable)....and some 8k of unidentified debt.

So how did the CC debt grow from 23k to 53k in one month?

If this posting is on the up-and-up, the OP needs to post a complete financial picture: expenses, savings (he has 70k in a 401k), income (unemployment? wife?), debts, etc.

[disneysteve]

This poster has been posting these questions since May, and never responds back to any of his older threads.

I've noticed the same thing. He posts stories that aren't all consistent, asks about debt consolidation, asks about bankruptcy, but never responds to anything. We seem to be getting a lot of that lately. It isn't spam, so it doesn't get deleted, but it is pretty annoying. The same has been happening with a bunch of the life insurance threads. I'm not exactly sure what the point is for the people posting them.

[Stuartthomas]

no credit card debt doesn't go away anyway