I did this when I was poor. There is nothing morally wrong, banks steal their money through inflation. When you don't pay the bank has two options: sue you for the money, or send it to collections. If you are poor you won't be sued. You aren't poor, so you will probably be sued. In that case you'll probably have to pay up. Since I was poor they sent my cards to collections. People try to contact you for years. They will contact other people, which will hurt your reputation. There are rules that the debt collectors have to follow, and sometimes they break them. You can then sue them and get a small payout. Each state has a clock, almost all are 6 or 7 years. After that time, you can no longer be sued for the debt. At that point, you will almost never be contacted regarding the debt again. However, if at any point you acknowledge that you owe the debt, the clock restarts. Your credit will be harmed for 7 years. If part of your debt is forgiven, the government treats that amount as income. So let's say that you own $10,000 and the debt collector says that he will accept $1000 to settle the debt. You send him $1000, but now you have to report $9000 in income for the year. However, if you simply don't pay, it is never forgiven, and thus never counts as income.