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So, my husband and I have some credit card debt and some of it has gone into collections. He was out of work for a while and due to that we were unable to pay most of our bills. I was just wondering what this does to our credit? How badly does it affect it? Will we be able to buy a car or house with credit card collections on our credit? Will it affect it even worse if we go to a debt management program? Please serious answers only. Thanks.

3 Thoughts on Question about Credit Cards In Collections in Texas?
  1. Reply
    mike truss
    December 1, 2012 at 2:20 pm

    Call the credit card companies and make arrangements to pay these past due amounts over time. once that’s done and after about a year of making payments it will show on the credit report you are current and if the auto loan people ask you about this on a car loan just explain.

    It shouldn’t hurt you too badly.

    However, there are people with low income to debt ratios’s and perfect credit that are being denied loans at this time for new car purchases.

  2. Reply
    Shane F
    December 1, 2012 at 2:50 pm

    It will mark “charge off” on your credit for 7 years. Most likely they will sue you in Texas if you cant pay anything. The best thing for you and your husband explain to creditor about your situations. They probably will work something out to set up payment plan or settlement with you. It will hurt your credit for some time. It may take a few years to rebuild your credit so you can buy a house or car. Best of Luck!

  3. Reply
    December 1, 2012 at 3:35 pm

    Always keep in mind that once a debt has been transferred to a collection agency paying that debt will NOT improve your credit at all. Unless the CA agrees to remove their tradeline from your credit report your best course of action is to dispute it with the CRAs until you are blue in the face (this normally works best once the debt has had time to age a bit) or wait patiently for it to fall off in 7 years.

    The older the debt is, the less it affects your score. Yes, you will still be able to make big purchases, but the more recent those negatives are the higher interest rate you are going to have to pay.

    Debt management can sometimes hurt you more than help you. I do NOT recommend this. There is nothing they can do for you that you can’t do for yourself. It’s a waste of money.

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