What if I don’t pay my debts?

Another thought experiment – what if I don’t pay my debts?

I’ll go to debtor’s prison. The end.

Hahaha. There’s no such place as a debtor’s prison anymore.

Wanna bet?

Maybe a debtor’s prison is not four grey walls and a bucket for unseemly but necessary bodily functions. But poor debt management can lead to pits of a different kind.

If I don’t make payments on a loan secured with property like a mortgage or auto loan, the lender will take the property. Now I have to find alternative living and transportation arrangements. Renting a decent apartment may be tricky as some landlords will run a credit check. And with a foreclosure, mine won’t look great.

As for transportation, if public transportation is a viable option, I’m fine. If not, there is a company out there that will finance a car. I won’t mind a 25% interest rate, right? It doesn’t matter the interest rate since I won’t be paying the debt. After a couple of rounds of default and repossession, it’s probably not worthwhile anymore.

But what about my unsecured debts like credit cards. Nobody’s going to take my house for not paying that debt. Of course, I could be living in a state that allows wage garnishments for an unpaid debt. But I don’t, so I’m fine.

My credit score will tank with the unpaid debts, but I’ve given up on debt anyway. I’ll just rent from landlords who don’t ask many credit questions. And pay cash for everything. I can totally afford to pay cash for my bus pass.

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