Many people often find themselves in a great deal of credit card debt. This can easily cause extreme financial hardship, harassment from creditors, and even lawsuits. Texas credit card laws, however, are much stricter than those of most states, providing a vast amount of extra protection to the debtor. Below is a list of some of the major points of these laws and what they mean for consumers.

Secured vs. Unsecured Debt

There is a key distinction to make between two types of debt. Secured debt includes loans for specific items, such as a car or a house. Unsecured debt is simply money that you owe which has accrued over time, such as a credit card bill. While secured debt can be collected through repossessing the unpaid item, unsecured debt can only be collected through a lawsuit. Credit card companies in Texas are therefore not allowed to repossess or take away any property or assets that you own. They are also not allowed to threaten to carry out any of these illegal actions, whether or not they follow through with their threats.

Garnishment of Wages

Most of the United States deems it legal for a credit card company to garnish your paycheck if they have obtained a judgement against you. Garnishment tends to be permitted up to 25% of your weekly income. In Texas, wage garnishment is not legal in any amount, even if a settlement has been obtained in the company’s favor. The only thing a company can do is take money right from your banka account. Of course, this can be a problem for them if someone doesn’t have a bank account, since this is the only legal way they have of obtaining their money.

Harassment

Texas has very forceful policies against companies harassing individuals. Federal laws are already in place to prevent many forms of harassment, such as illegal collection practices or constant phone calls at all hours. Texas law, though, goes above and beyond this, adding its own set of protections. Creditors are not allowed to threaten any debtor with criminal charges, or to continuously call a debtor on the phone, making it ring consistently. If the credit card company breaks any of these rules, the debtor can sue for monetary compensation.

Under Texas credit card laws, the debtor is heavily protected. Even though many of us owe credit card debt at some point, laws like this make it much easier to find a way out, obtain a fair settlement, and understand your rights, and the companies’ limitations.

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