How long will a creditor try to collect on credit card debt before giving up?
Summary
Credit card companies start trying to collect missed payments quickly, using fees and calls. If payments are not made for about six months, banks may mark the debt as unlikely to be paid and pass it to collection agencies, which can try to collect for years. Legal time limits exist for suing over debts, but collection efforts can continue even after those limits expire.Key Facts
- Americans owe record amounts in household debt, with credit cards being a large part.
- Average credit card interest rates are about 22%, making debts expensive.
- Missing payments leads to late fees, extra charges, and collection efforts.
- Creditors usually begin collection activities soon after a missed payment.
- After about 180 days without payment, a credit card company charges off the debt but may still try to collect.
- Charged-off debts can be sold to collection agencies, which may contact borrowers for years.
- Different agencies can own the same debt over time and try to collect separately.
- States have laws limiting how long creditors can sue for unpaid debts, but collectors may still ask for payment after that.
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