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What to do when credit card debt is in collections

When debts are not repaid, people run the risk of their accounts being sent to collections. Many people in Texas who are getting collections calls due to credit card debt or other outstanding balances may wonder about the best course of action when facing these bills. While bankruptcy may be needed in some cases, there are some things that can be done to manage debt prior to taking that step.

It's a good idea to carefully review all outstanding amounts and ensure there are no errors on the part of the lender. This should be done regularly, even if the consumer is not facing a great deal of credit card debt. However, scrutiny is particularly important when facing large debt loads. Once it is clear that all charges are fair and legitimate, work to figure out a long-term repayment plan that makes sense within a household budget.

Many people are unaware that debt can sometimes be negotiable. Simply put, creditors often would rather get something to cover outstanding balances than nothing at all. Even if collectors cannot reduce amounts owing, they may be able to extend payment deadlines or work out a payment plan. 

Consumers do have rights under the Fair Debt Collections Act, and there are limitations to what a lender can do when seeking repayment. Speaking with a Texas lawyer about credit card debt to understand options from a legal perspective is a good idea. A lawyer will also be able to provide guidance should bankruptcy be the best option.

Source: USA Today, "Facing bill collectors? Things to do if your debt goes to collections", Josh Smith, May 19, 2018

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