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Understanding debt collection in Texas

Texas residents may benefit from learning more about debt collection as described by the state's attorney general. When consumers fall behind in debt, they can typically contact the creditor, explain the issue, and negotiate to refinance or modify the current payment plan. Ultimately, it is easier for creditors to resolve debt issues without enlisting the services of a third-party debt collection company. While the debt collector has effective strategies for recovering debts from indebted customers, there are still laws in place to protect consumers' rights.

The Texas Debt Collection Act prohibits debt collectors from participating in abusive or fraudulent tactics to recover outstanding debt from businesses or consumers. Individuals or corporations who violate the act may be subject to civil or criminal penalties. People who have been deceived or harassed by collectors may be entitled to receive damages or injunctions against the debt collectors. Texas laws make it unlawful for anyone to try to collect more debt than the amount originally outlined in an agreement.

However, the amount owed may increase if the original agreement contains stipulations for additional fees, such as legal costs, investigation fees or collection fees. The laws give creditors 30 days to respond to a written notice about a dispute from a consumer. The creditor is expected to cease collection efforts and notify all interested parties if the consumer's claim is correct. The state finds it unlawful for collectors to engage in profanity, threatening language or anonymous phone calls in efforts try to recover debt from consumers.

People who have been struggling with finding ways to eliminate debt may benefit from contacting legal counsel. Lawyers may be able to protect debtors from harassing phone calls while helping to develop a sound plan for repaying the outstanding balance. Legal counsel may also be equipped to assist with exploring other alternatives that can achieve debt relief, such as bankruptcy.

Source: Attorney General of Texas, "Debt Collection", November 12, 2014

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