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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In the US almost every part of the economy works off a credit rating system. If you don’t pay back, even assuming there’s no legal penalties (which in extreme cases there could be), you will take a credit hit.
So the players that use this strategy will have bad credit, and thus will find themselves unable to get a loan in future, will have trouble getting mortgages or rent a place, and might even have hard time finding a job.
Meanwhile sufficiently many players are interested in participating in the economy that they will pay back. And in future they will continue to be able to get loans, mortgages, etc. So this means the banks and hospitals, etc can still be in business.
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