Georgetown Funding personal finance and debt consolidation offers are bait and switch and they won’t pay your debts. Georgetown Funding has begun flooding the market with debt consolidation and credit card relief offers in the mail with the website My Georgetown Funding. The problem is that the terms and conditions are at the very least confusing, and possibly even suspect.
The interest rates are so low that you would have to have near-perfect credit to be approved for one of their offers. Best 2020 Reviews, the personal finance review site, has been following Georgetown Funding, Tate Advisors, Plymouth Associates, Credit 9, Americor Funding, Safe Path Advisors, Silvertail Associates, etc.).
Best 2020 Reviews closely monitors personal loan offers While it’s not as bad as getting mugged or being stranded on a tiny island surrounded by sharks, not being able to pay your debts is one of the scariest life situations you can be in. This is especially true when the debt you are unable to pay is an important one, such as rent, mortgage or car loan repayments.
So, what exactly will happen if you do not pay your debt? Should you remain calm or fret over the situation?
It’s difficult to give an absolute answer to how afraid you should be without knowing the debt’s nature. For example, if you have a lot of credit card debt, you shouldn’t panic much because it’s not that bad. Almost everyone has credit card debt. However, being unable to pay a debt like a mortgage loan can have some serious consequences for you.
If owing money impacts your mental health, you should know that usually, situations are not as bad as we imagine them to be. However, it would help you if you had a clear idea of what lies ahead of you. If you don’t pay your debts, here’s what you should expect:
- Your debt will go to a collection agency.
- Debt collectors will get in touch with you.
- Your credit score and history will be negatively affected.
- Your debt will probably disturb your life for a couple of years.
- Life will go on whether or not you pay the debt.
Where Will Your Debt Go?
Under the United States Federal Law, a creditor will send your debt account to a collection agency if you haven’t paid your dues for 31 days past the due date. Some creditors might also collect payments on their own for up to 180 days. Do not lose control of your senses on day 31. According to industry experts, it takes around 60 days before a creditor sends unpaid debt to a debt collection agency.
The company or individual you owe the money to usually hires a debt collection agency. Paying the money to the debt collector will ensure that your money makes its way back to your lenders. However, debt collectors tend to charge their own hefty commission, which is usually between 25% and 45% of the debt amount.
If a debt collector feels that they cannot persuade you to pay up, they will sell your debt to another debt collector who they feel will have more luck convincing you. Your debt will seek you out if a debt collector owns it.
Will Debt Collectors Contact You?
If you pay your debt to the debt collector or negotiate a settlement, your problem will disappear as fast as it occurred. However, if you are unable to do this, you can expect letters to arrive at your address. Your phone will ring a couple of times a day, and there might be people showing up at your doorstep, asking you to pay up. You will get pitched for debt consolidation scams so be careful.
Before this stresses you out, you must know that different types of debts have different consequences. For example, if you took out a loan that was secured like mortgage or auto loans, the consequence could be you losing possession of your house or car. If the asset’s value under collateral is less than the debt value, you will not only lose possession of your asset but will still have to pay the remaining dues.
How Your Credit History Score Will Be Impacted
Your credit score will go down. If your credit score was already shaky, it wouldn’t make much difference to your credit history, but if you had a stable score, one missed payment could decrease it by as much as 100 points. However, it is impossible to determine by how many points exactly your score will fall.
Most collection debts stay on a credit report for up to 7 years, regardless of when you repay it. However, medical debt will be removed from your credit score as soon as it is paid off. Medical debts are handled differently than other forms of collection debts. Under the law, a government department must wait 180 days before listing a medical debt on a credit report.
The Debt May Haunt You for Years
There is a vast difference between an $250 debt and an $25,000 debt; if you cannot pay an $250 debt, you will not feel burdened. Creditors or debt collectors will contact you but eventually, stop when they are unable to pay up. Your credit score will not be impacted too much either.
However, an $25,000 debt is a different story altogether. If you are late in clearing your dues, a lender might have the power to sue you.
After you are sued, you have 20 to 30 days to respond; otherwise, you will lose the lawsuit. As a result, 25% or less (but not more because of the Federal Law limits) will be deducted from your salary or wages with every paycheck. The law might also charge a security interest on your car, home or any other asset. These things will also negatively impact your credit score.
Life Will Go On Regardless of Whether You Pay Off the Debt
If you feel tired or anxious, just remember that things will eventually work out for you. You will pay off what you owe at some point in your life or find some type of debt consolidation or relief. Time will pass even if you are unable to pay off your debts.
If you have excessive credit card debt, your state laws will determine the statute of limitations. Generally, it is between 3 to 10 years in most states.
Yes, it seems scary and very much possible to feel burdened because you owe someone money. Hounding debt collectors and lawsuits threats can disrupt your life. Unless your debts are for failing to pay child support or tax evasion, you will not go to jail. Things will resolve in time, one way or the other.
The outcome, however, will depend on the amount of money you owe. Let’s take a look at these scenarios:
Best-Case Scenario
Your debt will pass the test of time and become time-barred. It will eventually be removed from your credit report. A creditor only has so many remedies for the collection of debt. After they have exhausted all their options, you must no longer feel scared about getting sued for damaging your credit score.
Middle-Ground Scenario
A reasonable settlement on your debt can be reached, which will allow you to pay off the debt at a reduced amount in smaller repayments that will fit your budget. If you agree, no further debt collection efforts will be made on your account. The fear of probable lawsuits will also be eliminated.
If you opt for the middle-ground settlement, you will work with a debt relief attorney or a credit counseling service provider. The authorities will help you negotiate, manage and settle debts or declare bankruptcy. Credit counseling service providers are usually nonprofit organizations that are pretty successful in getting debt collectors to stop calling you.
Worst-Case Scenario
A lawsuit is eventually the worst-case scenario. The creditor has the power to obtain a judgment that can be effective for 20 years or more with high annual interest rates. The debt is collected through wage garnishment, bank account restraints or asset seizures.
Keep in mind that worst-case scenarios only happen to those who do not attend calls or respond to debt collectors’ letters. If you do nothing to solve your financial problem, it can become impossible for you to avoid it after some time.
