RSSCredit Card Debt Could lead to Losing Your Home
Jan 01
debt management credit card, debt No Comments
Most of us know what it’s like to have credit card debts hanging over our necks, but thankfully a lot of us are also able to acquire the debt repaid sensibly without getting into too many troubles with the lender.
However, when it comes to funds times are changing for a lot of people, and the hard climate has made it harder for many to cope with their credit card debt, particularly as the 0% balance transfer credit card market declines.
You may think that missing your credit card repayments and defaulting on your credit card debt will mean nothing more than a slap on the wrist from the provider, a bit of hassle from the creditor, and a black mark on your credit file. However, in actual fact the outcomes could be far worse, as you could end up losing your home for an unpaid credit card debt of as little as £1000.
A legal loophole for lenders, called the charging order, could mean that if you have unpaid credit card debt you could be forced to sell your home, even if the debt is comparatively small. Although these charging orders came into force in 1980 their use has expanded by one hundred percent over the past two years, with an increasing number of people failing to pay back their credit card debt.
Several are unhappy about this legal loophole, including Vince Cable from the Liberal Democrat party, who said: “No one should be permitted to lose their home simply because of a credit card debt. Several things needs to be done by the government to ensure that lenders simply don’t act overzealously, and only take possession of properties as a last resort. The fact that banks can now kick people out of their homes for not keeping up with their unsecured debts is very concerning.”
However, unless and until something is done to stop lenders from forcing house sales for even small credit card debts, it’s important for those with credit cards to ensure that they do all they can to avoid falling behind with repayments. This could mean simple steps such as to compare 0% balance transfer credit cards to move high interest balances from existing cards in order to cut down interest, speed up repayments, and reduce the repayment sum.
