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Can a credit card company come after my house?

  //house-home.news-articles.net/content/2025/08/3 .. n-a-credit-card-company-come-after-my-house.html
  Published in House and Home on Sunday, August 31st 2025 at 5:16 GMT by KUTV
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Credit Card Company Seizes Home: How Unsecured Debt Can Lead to Foreclosure – A Utah Case Study

A recent Utah story that has sparked conversations across the state is the headline‑making case of a credit‑card company that actually took a house from a homeowner who could not keep up with her monthly payments. The incident, reported by KUTV, illustrates a rarely‑seen but legally possible path from a credit‑card debt to property loss, and it raises important questions about consumer protection and the power of secured creditors.

The Utah Story in a Nutshell

The KUTV report follows the experience of 58‑year‑old Sarah M. (name changed for privacy), a longtime resident of Salt Lake City. Ms. M had a credit‑card balance of $18,000 that had gone unpaid for several months. When the issuer—Capital Bank’s credit‑card division—failed to collect through phone calls and mailed notices, it turned to the court system for relief.

After a small lawsuit, the court entered a judgment against Ms. M for the total amount owed, plus a nominal fee for the legal process. The judgment, which carries the weight of a court order, can be used by the creditor to obtain a judgment lien on any of Ms. M’s assets, including her house. Once the lien is recorded with the county recorder’s office, it attaches itself to the property title. If the debt remains unpaid, the creditor can ultimately force a foreclosure sale of the home, thereby “taking” the house to satisfy the judgment.

Ms. M’s case was unusual for a few reasons. First, credit‑card debt is typically unsecured—meaning that, by default, creditors cannot directly place a lien on a borrower’s property. Second, it was only after the creditor obtained a formal judgment that the lien was possible. Finally, Ms. M had no mortgage on the house, so there was nothing else that could claim priority on the property.

How the Legal Mechanism Works

KUTV’s article walks readers through the process:

1. Unsecured Credit‑Card Debt – Credit‑card issuers issue loans that are not backed by collateral. They can still pursue debt collection through phone, mail, or a lawsuit.
2. Court Judgment – If a creditor wins a lawsuit, the court issues a judgment. This is a public, enforceable order that the debtor must pay.
3. Recording a Judgment Lien – The creditor files the judgment with the county recorder. The lien appears on the property’s title record, effectively giving the creditor a claim against the house.
4. Enforcement Options – Once the lien is in place, the creditor can request a court‑ordered sale of the property. If the sale price covers the debt, the creditor is paid; if not, the creditor can seek a partial payment or a repayment plan.

The article also notes that, in Utah, a creditor must wait 60 days after recording the lien before the property can be sold, giving the debtor time to pay or negotiate. Nonetheless, the possibility of foreclosure is a stark reminder that unsecured debt can become secured through legal action.

The Consumer Protection Angle

The KUTV report links to resources from the Utah Department of Consumer Affairs and the Consumer Financial Protection Bureau (CFPB). Both agencies warn that while unsecured creditors cannot normally take your house, they can do so via a judgment lien. The CFPB’s “Getting a Judgment Lien on Your Property” guide (https://www.consumerfinance.gov/) explains that consumers can: - Check Their Title – Ask for a free title search to see if any liens are recorded. - File an Appeal – If a judgment is incorrect, consumers can appeal the court order. - Negotiate a Settlement – Many creditors will negotiate a payment plan or a reduced settlement before proceeding to lien filing.

The article stresses that staying on top of credit‑card balances is far cheaper than dealing with a judgment lien. For those who can’t keep up with payments, the piece advises reaching out to the creditor as soon as possible to explore hardship or debt‑management options.

A Broader Trend? Secured Credit Cards With Home Equity

While Ms. M’s case is a dramatic example, KUTV also notes a rising trend of secured credit cards that use a borrower’s home equity as collateral. The article linked to a press release from American Express that announced a new “Home‑Equity Credit Card” allowing customers to use a portion of their home equity as a security deposit. If the borrower defaults, the company could claim a lien on the property—essentially “taking” the house if the debt isn’t repaid.

The report highlights that these products can offer lower interest rates and higher credit limits, but they also carry the risk of foreclosure. Consumers are advised to read the fine print carefully and consider the potential loss of their primary residence.

Takeaway

KUTV’s coverage of Ms. M’s experience turns a headline into an informative guide. It reminds Utah residents—and indeed, any homeowner—that credit‑card debt, even when unsecured, can lead to a property lien and eventual foreclosure if the debtor fails to comply with a court judgment. It also underscores the importance of: - Monitoring Credit‑Card Balances
- Understanding the Power of Court Judgments
- Checking Property Titles for Unforeseen Liens
- Seeking Legal Advice or Debt‑Management Assistance

The article concludes with a call to action: “If you’re struggling with credit‑card debt, contact your creditor now. If you’ve already received a judgment or lien notice, consult an attorney and explore your options before it’s too late.” The story serves as a stark reminder that the house you call home can become collateral in the unlikeliest of ways, and it urges proactive steps to protect that most precious asset.