Many reasons could cause Texas residents to rack up high credit card bills. A job loss or medical crisis could put someone who normally keeps up with the bills into debt. To tackle it, a person could consider transferring a balance to a new credit card or getting a loan from a 401(k) retirement account.
Texas residents who rely on their credit cards to make ends meet after an unexpected setback like a layoff or illness sometimes find themselves in deep financial trouble. Revolving debt can be a convenient and straightforward solution to short-term financing needs, but making even minimum monthly payments can be a challenge when balances soar and income streams dry up. Credit card companies are generally aggressive when they are owed considerable sums of money, but they may be prepared to negotiate when their alternatives are writing a debt off or pursuing legal actions that offer no guarantees.
Texans have several options when they are facing overwhelming levels of debt. Those choices may include getting help from a credit counseling agency, engaging in a personal budgeting plan, going through debt settlement companies or filing for consumer bankruptcy. It is important for consumers to understand that debt-settlement companies are not the same as credit counseling agencies.
People who are struggling with debt in Texas may be looking at debt management programs that can help them pay down their bills. One common strategy for paying bills is the so-called "debt snowball."
Many Texas college students pursue degrees that they believe will lead to jobs. When colleges misinform students about job placement rates, unemployed graduates are left with a large amount of debt and no means to pay it back. Now, students who acquired federal student loan debt while going to a college that defrauded them will be able to have their loans forgiven.
Texas residents who are struggling to make ends meet sometimes pursue debt forgiveness or debt settlement because they are worried that their credit ratings will suffer and their assets will be seized if they file for bankruptcy. Many companies offer to help debtors to negotiate settlements with credit card companies and other lenders that they claim could save them hundreds or thousands of dollars, but they rarely mention that their clients may be left far worse off than they would have been had they filed for bankruptcy instead.
Texas fans of John Oliver may have watched his show where he bought $15 million worth of medical debt for $60,000 and then canceled it. An organization called Rolling Jubilee has been doing something similar for several years and recently shifted its focus from medical debt to student loan debt. However, even these efforts represent a very small amount of the total Americans owe.
Many recent graduates of Texas universities have student loan debt. Even if a person is able to get a job right out of school, which is not a guarantee for many, it may be a struggle for years to get out of tens or even hundreds of thousands of dollars of debt.
Debt relief service providers sometimes give sound advice to Texas residents who are struggling to make ends meet, but many of the business offering these services callously take advantage of those with financial difficulties. One such company, the California-based Student Aid Institute, was shut down by the Consumer Financial Protection Bureau for a raft of violations on March 30, and the independent federal watchdog agency also held the company's CEO accountable.
At a March 25 press conference in Boston, the head of the U.S. Department of Education said that there was evidence of fraud at 91 separate campuses linked to Corinthian Colleges. When the for-profit operator of those schools closed in 2014, it had 70,000 students, and it was estimated that 350,000 attended the schools since 2010. The company allegedly recruited homeless students and advertised nonexistent programs in an effort to lure students to its schools.