I’ve read a lot about how if you choose to not pay off your debt, it gets sold to a collection agency and then that there’s apparently no way for them to force you to pay it off. But I mean I doubt there’s no way that, that doesn’t impact you negatively. If it didn’t, everybody would not pay back mortgages, medical bills, etc. but if everyone did that, banks wouldn’t give out loans and hospitals would run to the ground if they got no money back, no? I’m kinda confused, how does this work?
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It depends on the kind of debt. If you don’t pay your mortgage or car loan, the lender can eventually take your house or car. So that’s negative. If you don’t pay a credit card debt then yes, technically you could avoid the debt forever but it would ruin your credit score and you would be unable to borrow money, rent an apartment, or even get certain jobs.
What most people don’t know is that there are some debts that never go away: Student loans and back taxes. Even if you declare bankruptcy, you can never expunge a student loan debt or an IRS bill. And eventually the govt can seize anything you have to get paid back including bank accounts, stocks, and even garnish your wages. No one tells you this when you’re 17 and applying to college of course, but student loans are forever.
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