In a Nutshell

Finding debt relief in Texas might seem daunting, but with help from TurboDebt’s programs and resources, we aim to make it manageable. We understand that Texans need choices to help relieve unsecured debt, especially since Loan Star State residents carry some of the highest credit card debt in the nation.

Financial expert and Founder and Managing Director of Reichert Asset Management LLC, offers the following advice to individuals seeking help with excessive debt:

 “When searching for a debt relief program in Texas, verify that the debt relief organization is properly licensed and registered to offer its services in Texas. Check if they comply with the state's regulations, such as the Texas Debt Management Services Act and the Texas Credit Services Organization Act.  Understanding the local legal environment is essential for providing effective assistance,” Reichert advises.

Read on for information about Texas debt relief, including debt statistics, options for relief, and answers to common debt relief questions.

The Lone Star State: An Economic Picture

You know what they say about Texas: everything is bigger. It’s the second most populated state in the U.S., just behind California. It’s also one of the most popular states for people to seek residence in because of its low cost of living and freedom from state income tax. 

While the “Lone Star State” may sound like a dream come true for cost savings, the amount of debt Texans have piled up is definitely one of the “big” parts of the state.

Credit card debt in Texas ranks higher than the national average. Because of this accrued credit card debt, along with missed and late credit card payments, Texas has one of the lowest credit scores in the US.

While it may be cheaper to live in Texas, with the low cost of living and access to multiple low-priced services, debts can still add up fast and put consumers in financial trouble. Income may not be consistent for many blue-collar workers, especially in the oil field industry, so debts can add up fast and put consumers in financial trouble.

Debt Relief: How Does it Work in Texas?

Debt relief is the process of relieving an individual, family, or group of their debts or money owed to debt collection companies through a specific payment plan. Debt can come from credit cards, medical bills, mortgage payments, personal loans, and other secured or unsecured debt. Finding the right debt relief option for Texas residents depends on their specific financial situation.

Debt Relief Companies

A debt relief company can function as a for-profit or nonprofit company that negotiates with lenders to change, reduce, or settle a person’s debts, offer financial guidance, or set up alternative payment plans.

Debt relief companies will often negotiate with lenders to let those in debt pay a “settlement,” which is a sum of money less than the total amount the person owes. They may ask you to put away a certain amount from your monthly paycheck into an account until the amount accumulated reaches the settlement amount. These programs sometimes ask the person in debt to stop making monthly payments to lenders.

What TurboDebt Does

At TurboDebt, we use strategic planning, advising, and consulting to help you find a program that will meet your financial needs. Debt relief is different for everyone, so we will work with you to find debt solutions that fit your financial situation.

Texas Consumer Debt Statistics

Average Consumer Debt

Texas consumers carry an average consumer debt of $54,290 after combining the average amount for auto loans, student loans, mortgages, and credit cards. Consumer debt comes from secured and unsecured loans. Secured debts are backed by collateral like your home or car, offering lower risk to lenders if you default on payments. Unsecured debts don’t use collateral and may come with higher interest rates since lenders risk more loaning the money. 

Credit Card Debt

A Texas resident's average household credit card balance was $3,650 in quarter four of 2022, above the national average of $3,480.

Auto Loan Debt

According to Federal Reserve microeconomic data, Texas has the highest average auto loan debt of any state in the U.S. at $7,610 per person. This is far above the national average of $5,470.

Mortgage Debt

With the typical home in Texas worth $303,971, homeowners can easily rack up mortgage debt. Soaring home prices and interest rates have made it difficult for first-time buyers to even finance a mortgage.

Student Loan Debt

Texas grads owe an average of $32,920 in federal student loan debt.


According to the American Bankruptcy Institute, a total of 20,121 Texans filed for bankruptcy in 2022. This includes 9,981 cases filed for Chapter 7 bankruptcy and 9,377 for Chapter 13, the most common filings for individuals experiencing financial hardship. 

According to the American Bankruptcy Institute, in 2021, there were a total of 19,762 filings for bankruptcy in Texas total. There were 12,461 cases filed for Chapter 7 bankruptcy, 828 for Chapter 11, 6,415 for Chapter 13, and 58 filings for other bankruptcy cases.

Average Income and Employment

In 2022, Texas’ median household income was $67,321, with a poverty rate of 14.2%

As of June 2023, the unemployment rate for Texas sat at 4.1%. Texas has seen unemployment trending higher than the nation and upward over the first two quarters of 2023.

Credit Scores

Texas had one of the lowest credit scores among all states in 2022, with an average credit score of 693.

A “good” FICO credit score is considered any number between 670 to 739, so Texas residents still average a viable credit rating for securing loans from lenders.

Identity Theft

Texas ranked sixth in the nation for identity theft in 2022, with a total of 113,808 incidents reported. The Lone Star State also came in fourth for cybercrime losses, with over 763 million dollars forfeited through online criminal activity. 

Banking and Tax Information

Texas currently imposes a 6.25% state sales and use tax on taxable services, retail sales, rentals, and leases. Texas does not have an individual or corporate income tax, but it does have a gross receipts tax.

Texas’s maximum local sales tax rate is 2.00%, which makes the combined state and local sales tax rate 8.25%.

The Federal Deposit Insurance Corporation found over 5% of Texans were unbanked in 2021. This indicates a large number of citizens don’t put their money in banks but use alternative sources to transfer and access funds. However, others are unbanked because they don’t have enough funds to meet the minimum balance requirements of most bank accounts.

How TurboDebt Has Helped Texas Residents with Debt Relief Programs

The total amount of debt enrolled through our company reached $76,162,211 for Texans in 2022, with the average debt enrolled per client at $22,420. Here at TurboDebt, we’ve helped a total of 10,358 Texas residents, with 3,397 individuals enrolled in our debt relief programs.

How TurboDebt Helped Texas Residents With Debt Relief Last Year

Top Types of Debt to Get Relief From

Credit Card

Credit card debt is one of the most common and daunting types of debt, with Americans owing a collective total of $986 billion

Texas credit card debt relief is one type of relief that TurboDebt offers. If you are in Texas and struggling to pay off your credit card, our team can help you find relief options in your state and assist you in working toward living a debt-free life.

Divorce Debt

Debt and money problems are some of the top reasons marriages end in divorce. The cost of getting a divorce can make your financial situation even worse.

Getting a divorce can cost an average of $15,000 per person, with individuals paying up to $100,000 in more complicated situations.

TurboDebt can help you manage your debt post-divorce by finding a relief program right for you.

Business Debt

The average small business owner has roughly $195,000 in business debt. The general rule of thumb is to keep your business debt within 30% of your business capital. Exceeding this number can lower your business’s credit score and give lenders the impression that you are irresponsible with your business’s funds.

In Texas, business debt relief programs can help you lower your business debt-to-capital ratio and help your business thrive again.

Medical Debt

Medical debt is another difficult financial burden to carry. In the U.S., 20% of adults carry healthcare debt, totaling 88 billion for citizens across the nation.

Settling your medical debt is tough, especially when you need to undergo expensive treatments or surgeries to live. However, TurboDebt can connect you with medical debt relief programs in Texas that can help you move toward a life free of medical debt.

Homeowner Debt

Mortgage debt is the largest form of debt for most Americans. With interest rates rising and home prices skyrocketing, affording a home is more difficult than ever.

At TurboDebt, we offer support so Texas homeowners can find mortgage debt relief programs that work best for their homeownership needs.

Retirement Debt

Two out of every five retirees reported having nothing in their retirement savings accounts. Since most retirees have little to no savings, debt can follow Texas residents even after retirement.

Here at TurboDebt, we strive to help even those who are no longer in the workforce settle their debts and live the rest of their lives debt-free.

Options for Debt Relief in Texas

Debt Management Programs

A debt management plan is a debt relief option that combines all your current debts into one monthly payment with a reduced interest rate. This can work for those who have a steady income and can make those monthly payments over the course of, on average, three to five years.

For example, if you have a combined balance of $14,000 on your credit cards, and you split that payment over five years, that’s 60 monthly payments. Each monthly payment would be about $233.33 before interest. Including interest, payments would depend on the rate the card companies are charging you, with some over 20%! You can also try to negotiate lower interest rates with each lender.

Let’s say you negotiate down to a fixed interest rate of 8.0%. If your balance on one card is $3,000, then the annual interest is $240. You divide that by 12 months, which is about $20. Add that to the credit card balance divided over 60 months, which is $50, and 50+12= $62. That would be your monthly payment on one card (assuming you did not make any further purchases with that card for the next 60 months). If you have multiple credit cards from different card companies, you can use this calculation to figure out your payments on those as well.

Debt management programs can also work for people who need assistance with managing and budgeting their money since this process creates a payment plan that works within their income and other financial obligations.

Debt Consolidation Loans

Instead of a monthly payment plan, debt consolidation loans are loans you take out to repay your debts. You borrow money to pay off your other loans in a lump sum, then repay that loan, including interest, over a period of time. Debt consolidation loans may require an upfront payment as well.

However, lenders may only offer low-interest rates on your payments as “teaser rates” for a certain period of time after you open your debt consolidation loan.  This teaser rate can expire after 6-12 months, at which point your rate may change to a higher level, oftentimes two to three times the teaser rate. You are also paying your loan back over a longer time period overall, which increases the total amount of interest you will pay over the life of the loan.

Debt Settlement

Debt settlement is the process in which the borrower negotiates with debt collectors to let them repay a certain percentage of the money owed and forgive the rest of the debt.

You may need a decent amount of money to settle your debt, and there is always the potential for scammers that promise they can forgive your debt after you pay them.

Debt settlement programs will usually require that you pay 15-25% of the remaining balance as a program (or service) fee. For example, if you have a remaining balance of $10,000 on a loan, and the debt settlement program’s fee is 18%, you will have to pay $1,800.

Credit Counseling

Credit counseling involves working with a credit counseling agency to help develop a personalized plan to address your financial struggles.

In a credit counseling program, you’ll work with credit counselors who are certified and trained in areas such as consumer credit, budgeting, and debt management. They advise you on how to create a budget and plan to pay off your debts, offer free financial education, and help you get copies of your credit reports.


Filing for bankruptcy is another option for debt relief. If you are struggling to pay off debts, you can eliminate or reduce them by either liquidating your assets or creating a repayment plan through the legal system.

You can file a petition with a bankruptcy court to start. All cases are held in federal courts, as outlined in the U.S. Bankruptcy Code.

There are different types of bankruptcy you can file for, depending if it’s just for an individual, a family, a business, a city, or another. For example, individuals can file for Chapter 7 or Chapter 13 bankruptcy to liquidate assets, while businesses can also file for Chapter 11 to reorganize them under their business structure.

Debt Forgiveness

Debt forgiveness happens when a lender forgives all or some of a borrower’s balance on their loan or credit.

Most types of debt can be forgiven, such as mortgage debt or student loans. However, borrowers must qualify for a special program to be considered for debt forgiveness. Many debt forgiveness programs are offered through the U.S. government.

Debt and Financial Hardship Resources in Texas

Texas Temporary Assistance Programs

Temporary Assistance for Needy Families (TANF): This is a program run through the United States Department of Health and Human Services that provides cash payments to families for food, clothes, housing, and other living essentials.

The Texas Repatriation Program: This program provides qualified U.S. citizens and their dependents temporary assistance in the form of a loan when they experience unexpected and unavoidable problems abroad. These citizens of Texas may have traveled from a foreign country suffering from an event that has made resources scarce, such as a pandemic or war.

State Health and Human Services

Lone Star Card: The Lone Star Card offers an Electronic Benefits Transfer (EBT) card for Texas residents that provides food and cash assistance through programs such as TANF and the Supplemental Nutritional Assistance Program (SNAP).

Feeding Texas: The largest hunger relief organization in Texas, Feeding Texas provides food and resources from food banks to families and individuals in need.

Supplemental Nutritional Assistance Program: SNAP helps people purchase food and garden seeds to plant food that has nutritional value.

Child Care

Texas Rising Star: A voluntary quality rating and improvement system (QRIS) program that works with childcare programs in Texas, Rising Star helps parents who want to find high-quality childcare facilities. Texas Rising Star works with childcare programs in the Texas Workforce Commission (TWC) and helps parents through their Texas Child Care Availability Portal find early learning programs with available spots.

Child Care Services (CCS): This program under the TWC provides financial aid to families in need of childcare that meet income requirements. Parents can choose from licensed child care centers, registered or licensed child care homes, or relatives that are 18 years of age or older.

Shelters for the Homeless

Permanent Supportive Housing Program: This program helps those who are 18 or older find safe, affordable housing and learn the skills needed to live independently.

Supported Housing Rental Assistance Program: The program helps those that are homeless or at risk of homelessness with temporary rent, utility, and move-in costs.

Projects in Assistance in Transition from Homelessness: This transitional program helps those with mental illness or those struggling with substance abuse and their families recover from homelessness.

Homeless Housing and Services Program (HHSP): HHSP provides funding to the nine largest cities in Texas to support those who are homeless or at risk of homelessness. They support programs for the construction, development, and procurement of housing in the following cities:

Free Transportation Services

Medical Transportation Program: The medical transportation program provides rides to qualified individuals to the doctor’s office, dentist’s office, hospital, drug store, or other medical buildings that provide covered health care services.

American Public Transportation Association: This association provides links to transit agencies for cities, towns, and counties within the U.S. You can find bus, train, and ferry services.

Senior Ride Programs: These services provide transportation for senior citizens who cannot transport themselves or go with a friend or family member.

A Debt-Free Life in Texas Can Be Yours

It takes strategic planning, consultation, and negotiation, but you can get your finances back under control before you know it. Now that you know about debt relief options and resources in your state, consider your options to start changing your financial situation.

While considering your debt-relief options, make sure to beware of debt-relief scams. Those in debt are near the top of the list for scammers. If something seems too good to be true, it probably is.

Also, remember to practice due diligence in your debt-relief journey. Debt relief is a process that must be taken seriously and correctly to get you back in control of your finances.

TurboDebt is here to help you every step of the way toward a debt-free life. Take the first step forward with a free debt relief consultation, and let us help you find the right debt relief option for you.