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socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 38117
Experience:  Attorney and Real Estate Broker -- Retired (mostly)
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Credit cards and loans what are the laws regarding collection.

Customer Question

Credit cards and loans what are the laws regarding collection.   One credit card (Lowe's) has a storage building on it.
Submitted: 7 years ago.
Category: Bankruptcy Law
Expert:  socrateaser replied 7 years ago.

The laws are quite straightforward. If you do not pay the bill on time, and you do not dispute a charge within 60 days of the date that it first appears on your credit card statement, then the creditor can sue you to collect (or, if your card agreement states that you agree to binding arbitration, then the creditor can take you to arbitiration, instead of court).


Assuming that the creditor wins the suit/arbititration, then it has the right to collect against your non exempt assets. However, in Texas, wages cannot be garnished to satisfy a debt (except for child support or a student loan), and this severely limits the creditor's ability to collect.


In your case, there is a storage building, which could conceivably be seized and sold at public auction to recover some portion of the debt. But, creditors almost never do this because it's too expensive in terms of labor costs.


Whether or not bankruptcy is an option depends upon your total financial picture, but basically, if you have very little income and few valuable assets, and a large amount of debt, then you may be a good candidate for bankruptcy protection.


If you have further questions, feel free to ask.


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