Sorry, but there isn’t a legal way to fully stop paying your credit cards.
Even if you file for bankruptcy, you’ll likely still have to pay a portion of your debt (though not all of it) through your assets being sold off or being put on a payment plan. So even bankruptcy, which many think wipes your debt in one go, isn’t a guaranteed way to get out of repaying your credit card.
There are two types of bankruptcy you can file for:
Chapter 7: Your assets — like your home, car, and other personal belongings — are sold to pay back your debt. Through this bankruptcy, your remaining debt is typically discharged within a few months. This negative mark will live on your credit report for up to 10 years.
Chapter 13: You’re placed on a court-approved payment plan. After a set period, like five years, any remaining eligible debt might be forgiven. This negative mark will live on your credit report for up to seven years.
FYI in most cases, your retirement savings are protected when you file for bankruptcy.
The other options to ultimately pay less are debt settlement or debt consolidation.
Debt settlement is when you negotiate with your creditor to pay less than the full amount you owe. For example, if you owe $10,000 you could negotiate it down to $5,000 to be paid in one lump sum or installments. Once the new amount is paid off the creditor can update your credit report. While having “settled” or “settled for less than the full amount” can hurt your credit score, it’s better than an “unpaid” mark. A settled debt, while still negative, shows that you took action to resolve the debt.
Debt consolidation combines multiple debts into a single loan with a lower interest rate. For example, if you have $10,000 in credit card debt across five cards with different interest rates it can be hard to manage. Debt consolidation allows you to turn that debt into one loan with a single interest rate — ideally lower than what you were paying on your other credit cards.
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