Can they take your house for credit card debt?
Asked by: Lemuel Russel | Last update: June 30, 2025Score: 5/5 (42 votes)
Fortunately, your home is safe from any creditors who do not have a mortgage or lien on it. Credit card companies and other unsecured loan holders can't come and simply take your property or home after missing a few payments. A creditor will first start making collection attempts by mail, phone calls or other methods.
Can I lose my house over credit card debt?
If you owe money for most other debts like credit cards and medical bills, you (usually) did not sign a security agreement. So, the creditors cannot seize your home to pay the debt. But, if you want to sell your home and creditors have filed judgments for unpaid debts, you may need to pay those debts before the sale.
Can credit card debt collectors take your house?
While credit card companies technically have the ability to pursue your home for unpaid debt, it's rare. A debt collector must go to court and get a judgment before it can place a lien on your home.
Can they put a lien on my house for credit card debt?
Yes, if the credit card company gets a judgment against you and you do not pay it, it can place a judgment lien on your home.
Can credit card debt be taken from estate?
Credit card debt doesn't follow you to the grave. Rather, after death, it lives on and is either paid off through estate assets or becomes the responsibility of a joint account holder or cosigner.
Can They Take Your House for Credit Card Debt?
Does credit card debt go away after 7 years?
Although the unpaid debt will go on your credit report and have a negative impact on your score, the good news is that it won't last forever. After seven years, unpaid credit card debt falls off your credit report. The debt doesn't vanish completely, but it'll no longer impact your credit score.
Can creditors go after family members?
Yes—but only if you co-signed on the debt or are a co-owner based on California's community property laws, as detailed above. Another example: An adult child can inherit debt if their name is on a loan or credit cards that their parent had when they died.
What to do if a creditor puts a lien on your house?
If a creditor puts a lien on your property, you may make an offer to settle the amount for less than you owe. As part of the negotiations, get the creditor to release the lien. Consider hiring a debt settlement lawyer to help you if you need help in the negotiations.
Can a credit card company make you sell your house?
They can file a claim for your property to cover unpaid debts. However, the actual answer is more complicated. A credit card provider cannot simply place and lien and take possession of your home. Instead, they first need to sue you for the unpaid credit card debt and receive a judgment in their favor.
What assets can credit card companies take?
What Can Credit Card Lenders Do? If a legal judgment is made against you, it is possible that the credit card company may attempt to garnish your wages, put a lien on your property, or seize your bank accounts. They can't directly take your home, but the actions they take could affect your home and other assets.
What happens if you walk away from credit card debt?
You Will Have Ongoing Damage To Your Credit
They can also take different actions that can make the situation even worse. Some may report immediately, while others may sell your debt to third-party collection agencies, who will assuredly file to obtain a judgment against you in court.
How can I protect my house from debt collectors?
An irrevocable trust can effectively protect your real estate from creditors. Still, depending on your needs, you cannot “undo” the trust once you have executed it, which can be problematic.
What happens if a credit card company sues you and you can't pay?
If you default on credit card debt, you could be sued by the credit card company or a debt collection agency. And if you lose the lawsuit, it could result in a judgment that includes liens on your property or garnishing your wages.
Can my property be seized for credit card debt?
If a creditor sues you to collect on an unpaid debt and wins, they'll get a court judgment against you. This court order allows them to collect on the debt by seizing your real or personal property (or putting a lien on it), garnishing your wages, or levying your bank account.
How long can a credit card company come after you?
A "statute of limitations" is a law that tells you how long someone has to sue you. In California, most credit card companies and their debt collectors have only four years to do so. Once that period elapses, the credit card company or collector loses its right to file a lawsuit against you.
How much credit card debt is too much for a home loan?
Keeping credit utilization under 25% to 30% on each card is a good general rule. This credit card debt affects your credit score and can make it drop. If your score drops too much, you could be denied a mortgage or pay a higher interest rate — which makes your mortgage payments much higher.
Can I lose my house if I default on credit card debt?
However, the answer to your question is: probably not. Credit card debt is unsecured debt. In order to lose your home, several things would have to happen. First, you would have to be sued in court and lose.
Can unpaid credit cards put a lien on your home?
If you own a home, and have fallen behind on your credit cards or other unsecured debts you may be worried about what these creditors can do to collect on the debt. In many states, including California, unsecured creditors can become secured creditors and place a lien on your home.
Can a collection agency take your house?
A debt collector can't just knock on your door, kick you out, and take your home. But if you fail to pay your bills, they can begin the foreclosure process in order to eventually take away your property.
Can a house be sold with a lien on it?
Can you sell a house with a lien on it? The short answer is yes. Especially if it's voluntary: Selling a home with a mortgage on it, for example, is very common. That's because you'll (ideally) be able to use the proceeds from the sale to pay off your loan balance and satisfy that debt.
Can creditors repossess titled property?
Creditors can take your property if you default on a secured debt. Learn more. A "secured debt" is one for which a specific item of property—called a "security interest" or "collateral"—guarantees payment of the debt.
Can you buy a house if you have a judgement against you?
Judgment liens can disrupt your mortgage process with the bank, throwing a wrench in the gears of your home buying journey, affecting your security interest and land records.
Do I have to pay my deceased mother's credit card debt?
When a loved one passes away, you'll have a lot to take care of, including their finances. It's important to remember that credit card debt does not automatically go away when someone dies. It must be paid by the estate or the co-signers on the account.
Why shouldn't you always tell your bank when someone dies?
If you contact the bank before consulting an attorney, you risk account freezes, which could severely delay auto-payments and direct deposits and most importantly mortgage payments. You should call Social Security right away to tell them about the death of your loved one.
Can I tell a debt collector I died?
Let debt collectors know that your loved one has died
You can let them know. You can also talk with a lawyer. A lawyer can help you protect your money and property from debt collectors under federal and state exemption laws. You may qualify for free legal advice or representation.