what happens if the credit card bubble bursts ?
will the credit companies go bankrupt and therefore the debtors not need to repay their credit cards?
- RICKLv 71 month ago
Even if the CC companies go bankrupt the money is owed and the debtors stillness to repay
- StephenWeinsteinLv 71 month ago
If the credit companies go bankrupt, the debts DO need to repay their credit cards.
- Ron AkiaLv 71 month ago
Only in a dream. The debts owed to the credit card companies would be purchased from them by another corporation and you would owe the new owner.
- JudyLv 71 month ago
Uh, wrong, they'd still need to repay, just to someone else who bought the company's assets.
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- Coffee DrinkerLv 71 month ago
If the "bubble" bursts then a few banks might go out of business and their accounts will be purchased by other banks. Nobody's debt gets canceled unless you actually file personal bankruptcy or negotiate a settlement with the owner. It would just mean you end up paying off the debt at another bank instead of the one you originally borrowed from.
this is exactly what happened to me with my first mortgage. I bought my first house in 2007 and got a mortgage from a company called "Countrywide Home Loans"
When the housing market crashed in 2008 there were too many people who couldn't (or didn't) pay their mortgages and Countrywide Home Loans became insolvent and entered bankruptcy. I still owed them a mortgage payment every month. After a bunch of court hearings Countrywide home loans went out of business and all their accounts were auctioned off to other banks. People who owned shares of Countrywide stock lost their money and people who had loaned money to Countrywide got only partial repayment - that's the risk of buying stocks and bonds.
During this process my mortgage was purchased by Bank of America. The only thing that changed for me was my monthly statements now had Bank of America's logo at the top instead of the Countrywide logo, and the address where I mailed the check each month was different. I still owed the same amount both in monthly payments and total balance, my interest rate and loan term were fixed.
The same thing would happen to credit card balances if the bubble "bursts" - a few banks might go out of business. People who own stock in that bank might lose their investment and people who held bonds might get little or no money back. But people who owe money to those banks will have to send their payments to the new bank and would be sued if they don't keep up with their payments.
Its not like some free reset where you can just walk away from your debt.
- Anonymous1 month ago
Immature 14 year old.
- GLv 51 month ago
Visa has $10B in working capital $46B in invested capital and $8B in free cash flow. No one is going bk anytime soon.
- frank lynnLv 61 month ago
That sucks! My crfedit cards are all paid off.
- ?Lv 61 month ago
The bankruptcy will include collecting debts.
- MurzyLv 71 month ago
They are usually backed by banks so they will get their money.