What happens if I never pay?

Question

I have a bill with Citi Financial that is $5300 with no collateral. It is now over 90 days past due. I have moved and changed my phone number. I know my credit is going to be gone forever... but what else could really happen? There was something in the contract about arbitration. What is that?

Answer 1

What's going to happen, is they're going to go to an arbitrator, to decide if you really owe the money or not.  If the arbitrator decides you do, they garnish your wages.  

They WILL find you, moving and changing your phone number isn't going to keep them away.  Meanwhile, every month your account is accumulating more late fees and overdue charges.  So it's only going to get bigger, your debt, by you ignorning it.

Answer 2

They will eventually locate you via an attorney.  Get a judgment against you and garnish your wages.  Meanwhile they will continue adding on interest, late fees and over limit fees.

Best to call and make payment plans or sign up with consumer credit counseling.

Answer 3

They can still find you, and they have a long time to sue you (five or more years depending on your state). If you live in a community property state, your spouse can be held liable as well. If they sue you and you still do not pay, they can garnish your wages or attach liens to your assets, like your home, if you or your spouse buy or own one.

Arbitration means that if you disagree with something that yor creditor does, then by signing the contrract with them, you have agreed to use arbitration rather than file suit in a court for damages. (this is like a private dispute resolution process that requires the use of a mediator between you and the company that you disagree with- and the company gets to pick who that mediator is.)  Many people get away with leaving these kinds of bills unpaid, and can stand to live with horrible credit, but if you need to buy something that you can't pay cash for, you will end up paying for it in rediculous interest rates if you are allowed to finance something. Keep in mind that with the economical slump that we are in, and all of the disasters happening in the real estate arena, banks are getting very aggressive about recovering thier money from people who are not paying the smaller stuff. I know someone who owes the same company $5000.00. She moved to another state and changed her name. They did find her, and two weeks away from the date that thier statute of limitations ended, she was served papers by a local attorney and is being sued for the original amount she owed, plus accrued interest and court costs! I hate to stress you out like that, but unfortunately, it is not a pretty picture. Good luck!