Right now, credit card rates are sitting at their highest point in recent history. As a result, credit card balances are ballooning — the average cardholder owes nearly $8,000 currently — and payment delinquencies are climbing. Nearly 9% of credit card debt was considered seriously delinquent as of the third quarter of 2024, a clear sign that many Americans are having serious issues with managing their credit card debt.
Being late on your credit card payments can have big repercussions for your finances, including credit score damage, late fees or penalty interest rates. Those aren't the only penalties you can face when your card debt is delinquent, either. If you fall too far behind on your credit card bills, you could face debt collection attempts from companies you've never even done business with. When this happens, it's an indicator that your credit card company has sold your debt to another company to try and recoup what's owed. Can credit card companies legally sell your debt to other entities, though? It's important to fully understand the answer to that question if you want to make the right decision on how to approach your delinquent credit card debt.Find out what your credit card debt relief options are here.Is it legal for a credit card company to sell your delinquent debt?The short answer is yes, credit card companies have the legal right to sell delinquent accounts to third-party debt buyers. This practice is explicitly permitted under federal law and regulated by the Fair Debt Collection Practices Act (FDCPA) and other consumer protection statutes. When you sign a credit card agreement, you essentially acknowledge that your debt can be sold or transferred to another entity.Credit card companies typically sell debts that are severely delinquent (usually 180 days past due) to debt buyers at a significant discount. This practice allows them to recover some portion of the outstanding balance while removing the delinquent account from their book
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