If you fail to repay a debt in full, it doesn’t just disappear. It’s usually sold to a collection agency, who may hound you about it for years. If that agency doesn’t collect payment, they may pass it on to another, and that agency may pass it on to another. And you may still get calls and letters about the debt years later. Surprisingly few consumers know that debts are subject to a statute of limitations. This means that creditors and debt collectors have a certain time limit to collect the debt or sue. If this time limit lapses, they no...

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Credit can be a wonderful thing. But when it gets out of hand, it can wreak havoc on your finances. This is especially true when it comes to credit cards. Charging up a large balance is bad enough, and by the time you add in fees and high interest rates, the debt can be overwhelming. In a perfect world, everyone would use credit wisely and pay off balances within a month or two. But in reality, cardholders often build up a mountain of debt and fail to realize it until it’s unmanageable. That’s when it’s time to put the plastic away...

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Sometimes people end up with more debt than they can handle. Often it is not due to irresponsibility, but to circumstances beyond one's control. Job loss, unexpected medical expenses and other such situations can cause finances to take a sudden turn for the worse. When such things happen, bankruptcy can ease the financial burden. Bankruptcy should only be used when all other alternatives have been exhausted. It remains on your credit record for ten years, making it difficult or impossible to obtain loans and other types of credit. But in some cases, it is a debtor's only hope for relief. If...

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With personal bankruptcy and household debt at record levels many people are reaching out for help with their debt. Many are looking to use debt-counseling companies that charge fees and promise to make creditors go away, but some of these companies are counseling their clients to ruin. The Federal Trade Commission last year censured several companies that falsely claimed that they can reduce their clients’ debt by up to 60%. Some of the companies advised their customers to stop paying their bills without informing them that they can be sued by the creditors. Several also claimed that they could help repair...

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Managing your credit can be a dicey proposition even when your life is calm. Add a couple of drastic changes — like relocating to another state, getting married, even watching your child become a teenager — and your credit is one of the first places the damage will show. Here are some ideas on what you should do when you’re faced with a major change in your life Getting Married If you're engaged, you may find it easier to talk about sex than finances with your future spouse, especially if one of you has a spotty credit record. Before you...

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If you’re planning to buy a home or a car in 2009, the process is going to be a lot tougher without an excellent credit score and a significant down payment. So that means you’re going to have to work harder—and possibly wait a little longer—to make those key purchases.

What’s a good credit score? According to credit scoring giant Fair Isaac Corp., the best FICO score range as of late 2008 stood at 760-850, according to reports; that minimum is roughly 20 points higher than it would have been a year ago.

Barring any major federal action to loosen...

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