Credit Card Debt Trap #5

By Mike Wayman

Debt traps are not all the same. Let’s say that you’ve fallen behind on debt and now you’re in collections. The collections industry is yet another level of debt trapping that is, by the admission of people in the industry, largely unregulated and the “salespeople” in debt collection often blatantly break the law just to make a buck. They call repetitively even if you’ve claimed bankruptcy. They will even continue to harass you after you’ve had an account included in a bankruptcy. One of the worst parts about these collection practices is that it can harm your credit even more after you claim bankruptcy.

Here’s how collections can hurt your credit even further after bankruptcy. There are a few creditors like auto finance companies and credit card companies that will extend credit to people after a bankruptcy has been discharged. However, one of the most important factors in determining whether or not to extend credit is if the borrower has had a late payment or collection after a bankruptcy. When you get a collection after a bk it really damages your ability to obtain credit in an effort to build your credit back up.

Collections are dangerous, collection companies are out of control and unregulated and you need to deal with collections as soon as possible to avoid problems with your credit after, during or before a bankruptcy occurs.