Do I Have to Pay Home Equity Charge-Offs?
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Collection Efforts Will Most Likely Continue
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If you choose not to pay a home equity charge-off, in most cases, the holder of the home equity lien will continue collection efforts after they have charged-off the debt. The lien holder may send the debt to a collection agency and or hire a law firm to sue you and attempt to obtain a judgment against you or your property.
Some People Are "Judgment Proof"
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If you are not employed and have no assets with the possible exception of certain protected assets such as retirement, you are considered "judgment proof." This means that even if the home equity lien holder sues you and obtains a judgment, it is not possible for them to collect on the judgment.
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Bottom Line
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If you don't pay a home equity charge-off, the home equity lien holder will most likely sue you. Unless you are "judgment proof," the lien holder will likely obtain a judgment against you or your property which may include garnishment of wages and seizure of personal property such as a bank account to satisfy the judgment.
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