What Happens If You Don’t Pay Your Credit Card? (2024)

If you don’t pay your credit card bill at all, you will likely get charged a late fee, lose yourgrace period, and have to pay interest at apenalty rate. Your credit score will alsogo downif you fall at least 30 days behind on a credit card bill payment. If you continue to not pay, your issuer may close your account. But you’ll still be responsible for the bill.

If you don’t pay your credit card bill for a long enough time, your issuer could eventuallysue youfor repayment or sell your debt to a collections agency (which could then sue you). But it’s not all or nothing withcredit card payments. It’s an entirely different story if you simply pay the minimum amount required.

Why you should pay at least the minimum payment:

If you always pay at least the minimum required by your due date, your account will remain in good standing and you won’t have to face late fees, penalty rates or credit score damage. You’ll just have to pay interest on the remaining balance at your card’s regular rate.

Here’s what happens if you don’t pay your credit card:

• If you pay the minimum required but not the full balance due:Your total unpaid balance will accrue interest at your card’s regular APR. You’ll also lose your grace period, so new purchases will accrue interest right away, too.
• If you don’t pay at all:Your account will be reported as past-due to the credit bureausafter two missed due dates. That will hurtyour credit score. In addition, a late fee of up to $40 may be tacked onto your balance (but it can’t exceed your minimum payment). Your issuer may also apply apenalty APRto new purchases, though they must inform you 45 days in advance.
• If you get 60 days behind on minimum payments:The issuer can apply a penalty APR to your entire existing balance.
• If you get 180 days behind on minimum payments:The credit card company will have tocharge offyour debt (consider it a loss for taxes). But that doesn’t mean they’ll stop trying to get you to pay. They may sell your debt to a collections agency, or they may choose to sue you.
• If you don’t pay for 3-15 years:You are vulnerable to alawsuit, depending on which state you live in. Time-barred debt is not a valid defense until yourstate’s statute of limitationsruns out. If you lose a lawsuit and are ordered to pay, you might have your wages or bank account garnished.

So, the bottom line is that you should always try to make at least the minimum payment on your credit card. Sure, you’ll still owe interest, but you won’t have to deal with the other negative consequences of not paying your credit card at all.

If you’ve fallen behind, the most important thing to do is catch up on your missed minimum payments and bring your account back to current status. After that, your goal should be to pay your full balance due for two months straight. Though that’s easier said than done, doing so will restore your grace period and stop the buildup of new interest.