Collection Agencies in Texas and Laws

Texas Debt Collection Laws

1. Fair Debt Collection Practices Act (FDCPA): This federal law applies across the United States, including Texas. It prohibits debt collectors from using abusive, unfair, or deceptive practices when attempting to collect debts. For example, they are generally not allowed to call before 8 am or after 9 pm, make false statements, or harass you.

2. Texas Debt Collection Act: This state law is similar to the FDCPA but applies to creditors collecting their own debts, whereas the FDCPA mainly applies to third-party debt collectors. The Texas Debt Collection Act prohibits various unfair practices, including threatening violence, using obscene language, or making repeated phone calls with the intent to harass.

3. Texas Finance Code: This code regulates the conduct of debt collectors. Sections under Chapter 392 of the Texas Finance Code, for example, require debt collectors to provide certain written notices and prohibits them from engaging in harassment, misrepresentation, or unfair practices.

4. Statute of Limitations: In Texas, as of 2021, the statute of limitations for debt collection through the courts is 4 years for most debts. This means that a creditor or debt collector generally cannot sue you to collect a debt if the debt is more than 4 years old. However, it’s important to note that a partial payment or acknowledgment of the debt may restart the clock.

5. Homestead Exemption: Texas has generous homestead exemption laws, which means that in most cases, a creditor cannot force the sale of your home to satisfy a debt.

6. Protection of Certain Property: Texas law exempts certain personal property from seizure by creditors. This includes things like home furnishings, clothing, tools of a trade, and a certain amount of equity in a car.

7. Wage Garnishment: Texas has stringent wage garnishment laws. Generally, wages cannot be garnished for most debts. However, there are exceptions for certain types of debts like child support, student loans, and federal taxes.

8. Post-judgment Interest: In Texas, if a judgment is entered against a debtor, the judgment accrues interest at an annual rate determined by the state. This is intended to encourage the timely payment of judgments.

9. If a debt is disputed, collection agencies have 30 days to determine if the disputed item is correct.
   
   
10. Wages may be garnished only to pay debts related to court-ordered child support, back taxes, and defaulted student loans. Debt collectors cannot garnish wages for repayment of consumer debt.

Please note that laws and regulations can change over time, and new laws can be enacted. Always consult with a qualified attorney or legal expert for the most current information and advice regarding debt collection laws in Texas or any other legal matter.

A complete list of federal laws to be followed by all collection agencies in USA is listed here: Debt collection laws 

If you buy Collection Letters service from a Collection Agency, you would pay an additional Sales Tax, which ranges between 6.25% to 8.25% , applicable to all Texas businesses and residents.

Texas Debt Statistics

• The average person in Texas carries over $38,000 in debt.
• The average Student Loan in Texas is about $31,000.
• The average mortgage debt in Texas is $177K in 2018.
• The average credit card debt in Texas as of 2019 is around $9,100
  An average Texan had an auto loan balance of $24,500 as of 2019
• Texans had an average credit score of 659 in 2018

Texas Geographical Stats

• Population in Texas: 29.5 million (year 2021)
• Number of millionaires: 650K  ( year 2022)

Texas debt collection agencies can collect all across the state, including Houston, San Antonio, Dallas, Austin, Fort Worth, El Paso, Arlington, Plano, McKinney, Frisco and Corpus Christi. Texas is known for its strict consumer protection laws.