Credit Help in Texas

Debt Negotiation

If you're overwhelmed by collection calls and piling credit card bills, you should contact a local non-profit credit counseling service, advises the Texas Attorney General. Such services can help you renegotiate your debts into more manageable payment plans and help you avoid the potential pitfalls of bankruptcy. However, you cannot get any new credit while partially repaying your debts through a credit counseling service.

Debt Collections

The Texas Debt Collection Act and the federal Fair Debt Collection Practices Act help even those consumers who owe creditors a lot of money. Under these laws, bill collectors cannot use abusive language, make empty threats of lawsuits and must stop calling upon written request. Texas residents also can demand evidence that they owe the debt and get in touch with state and federal banking authorities if their rights are grossly violated.

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Chapter 7 Bankruptcy

As a last resort, people with serious financial problems who economically qualify can file for Chapter 7 bankruptcy. This filing will liquidate most preexisting debts but negatively impact credit ratings for 10 years. As of 2011, Texas asset exemption laws allow people who have lived in the state for at least two years to keep all equity from their primary residence, according to Bankruptcy Action. The usual standard of bankruptcy qualification is to earn no more than the state's annual median income level. As of 2011, the annual median income for a single Texas resident was $38,801, while the figure for a family of four was $66,145, according to the U.S. Trustee Program.

Chapter 13 Bankruptcy

People with steady income can request partial debt repayment under Chapter 13 bankruptcy. It usually takes three-to-five years to partially repay debts in Chapter 13; Texans cannot legally get new credit while in Chapter 13. Their bankruptcy statuses will also negatively impact their credit ratings for seven years from the date of filing. As of 2011, state asset exemptions also allow single Texas bankruptcy filers to keep up to $30,000 worth of personal property, according to Bankruptcy Action. The figure is doubled to $60,000 for a couple or family.