When a Tennessee consumer is unable to manage his or her credit card bills, the credit card company may send the debt to a collections agency. Before sending credit card debt to collections, the card company may call to attempt to collect. This often happens when the cardholder is at least 30 days behind on making a minimum payment. After months of unpaid balances, it will likely be sent to an agency dedicated to collecting past-due balances.
No matter how much a consumer owes, there are limits to what a debt collections agency can do. The agency cannot threaten the cardholder, harass, make false statements or use obscene language when on the phone with the individual. Some cardholders who are behind with their debt may be able to work out a payment plan with the collections agency.
For consumers for whom a repayment plan is not an option, a balance transfer card may be an option. This is a credit card that can allow a cardholder to consolidate balances and benefit from a lower interest rate. However, transferring the balances does not make them go away. The consumer still has the obligation to pay these balances at some point.
Credit card debt can spiral out of control and quickly outpace a cardholder’s ability to make even minimum payments. When these balances are sent to collections, it indicates that a Tennessee consumer needs help with their financial situation. In some cases, a reasonable course of action is to file for consumer bankruptcy protection, a process that allows for the discharge of most unsecured balances.