Dear Dave,

I’ve been late on a credit card bill several times, and it was turned over to a collection agency. They have offered a couple of different payment options. If I agree to one of these, does that mean the original creditor gets paid, too?

Carter

Dear Carter,

A collection agency either owns the debt outright, or they’re directly representing the credit card company in these kinds of situations. It’s not unusual for things to be handled this way when someone has defaulted on a loan.

Unless you have the cash to make good on the debt outright, I’d go ahead and accept whichever deal makes the most sense for you and your current financial situation. You’ve already got a mark against you on your credit report for having this turned over to collections, so an indication of settlement on a credit card you defaulted on is really no big deal.

But here’s my best piece of advice—stop using credit cards!

—Dave

* Dave Ramsey is CEO of Ramsey Solutions. He has authored seven best-selling books, including The Total Money Makeover. The Dave Ramsey Show is heard by more than 14 million listeners each week on 600 radio stations and multiple digital platforms. Follow Dave on the web at daveramsey.com and on Twitter at @DaveRamsey.