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Delinquent Debt Timeline: How to Recover at Each Stage

January 3, 2017
Paying Off Debt, Personal Finance
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We adhere to strict standards of editorial integrity. Some of the products we feature are from our partners. Here’s how we make money.

Unpaid debts don’t go away; instead, they can lead to debt collections, lawsuits and wage garnishment. But if you take action to deal with your delinquent debt, you can protect your budget — and your credit score — from the worst repercussions.

If you have many delinquent debts, look into debt relief options. Creating a plan to contend with debt can help safeguard long-term goals such as retirement.

One warning: No matter how much you owe, avoid resorting to high-cost borrowing such as a car title loan or payday loan. It can lead to a spiral of debt that’s hard to escape.

Learn more: Use the timeline below to understand each stage of what happens when a debt becomes delinquent. Click on any stage along the way to learn more about what happens behind the scenes and what you can do to remedy the situation.

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Sean Pyles is a staff writer at NerdWallet, a personal finance website. Email: spyles@nerdwallet.comTwitter: @SeanLoranPyles