About 'what is bad debt'|Ireland Is Drowning In Bad Debts
Bad debt of any kind can haunt you for the rest of your life. Paying off debts that have been charged off or are very old is important to your credit rating. It looks very bad to have a charge-off on your credit report. It can be redeemed to a point though. That is, if you pay it off. Although you may be able to get away with paying those old bills off, it will more than likely haunt you for years to come. If it is a major bank or credit card that you owe, they will continue to call you for years afterwards to attempt collection. This means that it will continue to be on your credit report all of those years. You have to ask yourself if it is really worth the trouble of avoiding payment. Legally, yes, you will always owe the money if you don't pay it. There are limits on the time that a business can take you to court to collect it. Those limits will vary from state to state. In order to find out what those limits are it is best to check your state and local laws on it. If it goes to court, your wages can be attached and your bank account can be frozen and the money in it confiscated. Here are some of the reasons that you need to pay off charge offs and other old debt: Credit Report The first thing that non-payment of your bills creates is a horrible credit rating. Your credit report is important to many aspects of your life. The ability to get some jobs can even be affected by it because many employers check your report to see that you are a reliable person to have in their office. The information that is reported on your credit report stays with it for up to seven years. That is a long time to have bad marks on your credit report. If the creditor or the collection agency calls you about the money due, the process begins all over again. It is a vicious cycle that can haunt you for the rest of your life. Loans If you do not pay off your old loans, including credit card bills, you will find it very difficult to get a loan in the future. This means that you will not be able to obtain a loan for a car or a home. These are two major purchases and ones that you cannot get around. That in turn forces you to live in sub-standard housing and drive cars that are far less than reliable. In fact, you may not be able to get a car at all if you don't have the cash to pay for it. Insurance Insurance rates sky rocket when you have a bad credit report. Most insurance companies check your credit to determine your premium. This may not sound fair, but it is legal and it is used. It is probably cheaper to just pay off the debts and get it over with. Other aspects of your life that are affected by a bad credit rating is jobs, the ability to rent a place to live or any other credit cards being issued to you. It truly isn't worth the long-term costs of not paying your bills. If you pay them, no matter how late they are, you will be better off. The bad credit rating can eventually disappear but only if you pay off what you owe. Don't take the chance. Pay off what you owe and get it over with so that you don't end up spending your life running away from bad debt. |
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