Can I just stop paying my credit cards?

girlscout666

Hello,

I am new to MSE, so hi fellow forum-ers!

OK so, my question to you (sensible, helpful answers please i am not here to be judged or lectured) is what REALLY will happen if I decide to step away from my credit cards and stop paying altogether?

My situation is this:

When I was 19 or so I got 2 credit cards (barclaycard & Capital One). One has £1500 on it, the other £1000. So in all I am in £2,500 worth of debt. I know it doesn't sound a hell of a lot to some people but to me, it is.

I racked up both cards and maxed them out pretty quickly (as you do when you're young and dumb!) Last year I lost my job and fell behind on payments on both cards, as well as a small loan I have with HSBC (which is now thankfully almost paid off) after weeks of tears and tantrums and being terrified of what to do, I spoke to a friend and realized I could just arrange a payment plan with each card.

I did this, and arranged with both to pay just £30 a month off each. Both said they would freeze or lower the interest considerably so that the balance would go down quicker... but it's NOT!! I get the odd statement through every now and again and the balances are the same as wen I started the payment plans!

I don't know what to do as I can barely afford the £60 a month I am currently paying to them.

My credit rating is crap as it is, and will most likely take a few years to recover anyway.. so what will REALLY happen to me and my credit rating if I were to just stop paying my cards off and ignore them???

Cheers!

jonesMUFCforever

You will be taken at dawn to a prison cell where you will rot until you decide to pay your debts!

jd87

Debt collection companies. County court summons. Court appointed bailiffs coming to your home and taking your stuff.

Perhaps you should actually try asking the companies about the issue of them still charging interest if you were so sure that they said they would stop.

jonesMUFCforever

.....................or nothing bad will happen unless you want any new credit for the next 6 years'.

I would suggest a visit to CAB.

cajef

girlscout666 wrote: »

so what will REALLY happen to me and my credit rating if I were to just stop paying my cards off and ignore them???

Good idea if you never want a loan, a credit card, to borrow money or get a mortgage again, after you have managed to avoid the bailiffs etc.

kerri_gt

The reason the balances will not have moved much is the monthly payment to interest ratio.

Also, you should receive monthly statements, your post suggests you are not or are you just not opening them, does this mean you are missing some monthly payments?

Rather than burying your head in the sand and thinking about stopping paying your cards, which will not achieve anything, how about posting a SOA on here and looking at how you can clear your debts quicker?

girlscout666

Hi Kerry (and others)

I am making monthly DD's so not missing any payments at all. And no, I don't get monthly statements.. I maybe get one every few months? The cards have been stopped and I am no longer using them - perhaps thats why?

I was told that the interest would 'near enough' be frozen, or at least lowered to the point where if I stick to a lowish payment of £30 a month, the balance will still go down, but this doesn't seem to be the case!

Tixy

girlscout666 wrote: »

I did this, and arranged with both to pay just £30 a month off each. Both said they would freeze or lower the interest considerably so that the balance would go down quicker... but it's NOT!! I get the odd statement through every now and again and the balances are the same as wen I started the payment plans!

So the balances haven't gone down at all? So on the statements interest is still being charged? And is that interest on both cards £30 the same as your payment?

Instead of trying just to stop payments I would suggest you complete a statement of affairs to show your monthy income & expenditure and work out what you can afford a month and see how that compares to the £60 you are currently paying

Then write to the credit card companies enclose your statement of affairs, tell them how much you can afford a month and ask them if they will agree to freeze interest.

Are you working now? or still on benefits - if on benefits then I would suggest you offer far less than £60 a month and it should be accepted. If you are working then before you send the statement of affairs you might want to post it up on here (probably on the debt free wannabe board) for some advice on whether the cc companies might be likely to accept it, or whether there is some expenditure that they would not consider reasonable etc.

Tixy

girlscout666 wrote: »

I was told that the interest would 'near enough' be frozen, or at least lowered to the point where if I stick to a lowish payment of £30 a month, the balance will still go down, but this doesn't seem to be the case!

Was this on the phone or in writing? Best to do things in writing. If you are being charged £30 interest on a £1000 debt then thats over 30% APR. Unless they are adding on charges as well as interest?

girlscout666

I am working, wasn't out of work for too long and have never in my life claimed benefits.
I went through the process you've mentioned already with both lenders (expenditure forms and agreeing to freeze or considerbly lower interest) and have been paying my agreed £30 a month on each now for about 10 months. You'd think that the balance on each would have decreased a lot but, as far as I can work out, they havent.

paulwellerfan

why dont you phone them up and try to negotiate a payment plan with them.
its the nice thing to do.