- Posted by admin
- On August 10, 2017
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- credit card debt card collection, credit counseling services, debt consolidation services, mortgage services
A credit card is a service provided by the banks through which the credit card holder can first draw money and then repay it back after a specific period of time, unlike debit cards. Credit cards don’t attract interest, rather the holders of credit card are penalized for non-payment of the principal drawn. What follows with this easily available service is credit card debt collection, which is a supreme activity in any bank. Though most people don’t intentionally default the credit card payments, the fact that around 10 to 15 percent of all the outstanding credit card payments default and only 25% of all credit card balances are paid by card holders in Mississauga, Canada, has made credit card debt collection a pressing matter.
Credit cards come with different drawing limits to different account owners in a bank. Based on the goodwill, source of income, past record and overall profile of the customer, they are provided with a suitable credit card by the bank.
In Mississauga, the process of credit card debt collection begins when you fail to make a payment on your credit card for 180 days on an outstanding balance. For some lenders, it may be 90 days. The lender may also get in contact with your friends and relatives in the process of the debt collection.
The following are the broad consequences in case of default by a credit card holder in Mississauga:
1. The lender will start attempting to collect money from you.
2. You lose the rewards entitled to your credit card previously.
3. Impact on your credit report and credit worthiness.
4. Other consequences like increased insurance premiums, refusal of rental property, employment issues etc.
After defaulting on a credit card, you can either pay it off or settle the debt or do nothing or declare bankruptcy.
If the bank chooses to not to be a part of the credit card debt collection process, it may close your account and transfer your debt to a collection agency, also called as ‘debt buyers’. In this, they quickly realize a fixed amount of your debt that is much lower than the debt. There are many debt collection agencies which intensively follow the back of the defaulting credit card holders in various styles for the realization of the debt.