What is credit card debt?

Credit card debt occurs when a borrower borrows money from a creditor on the promise of repayment. In California, credit card debt is an unsecured debt, meaning that there is no collateral associated with the loan and the creditor does not have a legal claim to any of the borrower’s property. Credit card debt may arise from purchases made on a credit card, cash advances, or balance transfers. Credit card debt can also arise from the fees associated with owning a credit card—such as annual fees, late fees, or over-the-limit fees. In California, credit card debt is considered a type of consumer debt, and is not secured by any property or object. Credit card debt must be repaid to the creditor, including any applicable interest rates and any late fees that may apply. Failure to repay a credit card debt can result in significant consequences, such as creditors taking legal action against the borrower, or the borrower’s credit score being negatively affected. Borrowers should always be aware of their rights and responsibilities before taking out a loan or making a purchase on a credit card. It is important to be aware of the terms of the loan, including the interest rate, repayment timeline, and any associated fees. Additionally, borrowers should keep track of their credit card activity, making sure to stay on top of payments and to not use more credit than is available. By following these tips, borrowers can avoid the consequences of failing to repay their credit card debt.

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What is credit card debt?

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