What Happens If I Default on Credit Cards?

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Defaulting on credit card payments is reported to credit reporting agencies and can result in large fees and increased interest payments on loans. Avoid losing a car loan or apartment because of defaulted credit card payments with advice from a registered financial consultant in this free video on credit.

Part of the Video Series: Money Management & Personal Finance
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Video Transcript

This is financial adviser Patrick Munro answering the question what happens if I default on credit cards? It's a question that many people ask in this recessionary time when times are hard. It's very important that you do your very best to pay your credit cards on time because the reporting services from the 3 credit bureaus, EquiFax, Experian and TransUnion are all linked to various organizations that look at your overall report reporting history. In fact not paying your credit cards on time in addition to charging a fee, which is quite hefty, the credit card will then trigger the reporting agencies to report you as late and that could affect your car insurance where they'll increase your premium on renewal as being a highest risk because you don't pay your bills on time. It could affect you getting a new or better apartment because of the fact that the landlord now considers you a risk. It's all about character, etcetera, etcetera and it has a ripple effect. So make sure you keep credit card balances down or at a minimum and make sure that you do not default on credit cards because consequences are significant.


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