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Hypothetical question, assume US jurisdiction.

When someone buys an item with a credit card and then skips on the card bill payment, is there a legal provision for the card issuer to claim ownership over the bought item or service? Or is it then just a dispute over arrears?

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  • I doubt the credit card company would own it, unless the card agreement has some unusual provision to that effect. That would effectively convert an unsecured loan to a secured loan, which would seem to need the borrower's consent. However, if the lender sued over the debt and obtained a judgment, they might be able to get a court order to seize the borrower's property to satisfy the debt, perhaps including the purchased item. Commented Jan 4, 2016 at 17:01
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    There's a practical issue too: I buy 5 items on my credit card, each costing $100. I pay the credit card issuer only $400. Which of the 5 items would the issuer be able to claim? Commented Jan 4, 2016 at 17:03
  • @NateEldredge There are legal solutions to such issues. For example, a floating charge can be secured against a class of assets (e.g. "all items you have purchased with your credit card") with the creditor then able to crystalize the charge at the point of default and recover such assets as are necessary to repay the debt (note: I'm not saying that floating charges are actually used in credit card agreements).
    – JBentley
    Commented Nov 14, 2022 at 17:09

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A credit card debt is generally unsecured i.e. There is no property put up as collateral for the loan. In particular, goods purchased with the facility are not collateral.

If you default on the debt then the creditor can sue you and obtain judgement. With that in hand they can seek to enforce that judgement. There are two methods that involve seizure of property: direct seizure of whatever the court officer can get and bankruptcy which places all property in the hands of the trustee. This may include stuff bought with the card but not necessarily.

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