I have a credit card debt worth $70,000. I’ll earn around $70,000 by selling a house. I’m planning to default on credit cards and use $70,000 for other purposes. Let the debt go to collection. I will negotiate and reduce it later. How is my plan?

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It depends upon the condition of your credit. If your credit is in good shape, then I would suggest you to use the money for reducing the overall amount to a reasonable level and use the rest of the amount for other purposes.

It isn’t a nice idea to send debt to collections or go bankrupt. Debt collectors are ruthless. They’ll drag you to court since the amount is really big. If they win the case, the court may impose a lien on your house.

Going bankrupt is a stupid idea especially when you have means to pay off debt. You’ll end up paying the amount as per the guidelines of bankruptcy trustee. You won’t have any freedom. And remember, you’ll go to jail if you hide $70,000 from the court to avoid paying off the debt.

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Last Updated on: Fri, 8 Jun 2018