Financial problems can crop up suddenly without any warning. An accident can culminate in burdensome medical bills and given that such uncalculated costs can have a domino effect, it can go on to cause a range of difficulties including falling behind on credit card bills and mortgage payments.
This can in turn can go on to affect an individual's credit rating making it harder for the person to obtain credit easily and in some cases, face creditor harassment. Such incidences are not uncommon, even in Texas.
However, the state has implemented certain laws that are geared towards protecting the consumer's right to equal opportunity when it comes to applying for credit. Most importantly, creditors cannot discriminate when accepting or rejecting credit applications based on factors such as sex, race, color, creed, nationality, age and religion.
Since it is safe to assume that financially burdened people applying for credit may be receiving public assistance, creditors are also not allowed to give any less consideration to income from public assistance compared with income from other sources.
On the other hand, creditors do have their own set of rights which allow them to reject credit applications if the applicant fails to meet specific standards. Creditors are also allowed to either attempt to collect on defaulted repayments and may seek the assistance of a collection agency to recover debts from a consumer.
In case all debt collection options have been exhausted, a creditor also has the right to seek legal remedies. In such cases, if the court finds in favor of the creditor, a lien can be placed against the debtor's assets to aid recovery or a wage garnishment order may be issued.
Source: Federal Trade Commission, "Your Equal Credit Opportunity Rights," January 2013