Speaking in accounting terms, debts are usually referred to as accounts receivable. The two common techniques of accounting for bad debts are known as the allowance method and the other is the write off method. Without claiming either situation to be better than the other, but if you are just an average working person rather then some company who has a whole accounting department, it may be more difficult for you to pay off you debts, let alone even realize how quickly you are putting yourself into such a situation.
People get themselves into all sorts of debt and become bad credit people all of the time, but the number one thing to always avoid is allowing that debt to become bad debt. Debt becomes bad debt when the creditor has done everything that they could within their power to collect but was unable to do so. Once something becomes bad debt, then more severe consequences come into play and everything becomes much worse.
Although bad credit people have put themselves in the position, and debt collectors are supposed to do everything they can to get the money, it is still important for collectors to never leave more than one phone message per day for a debtor, and to never leave a threatening message nor mention any statements that present the debtor in a bad light. If ever in the situation, you can pay a collection agency a fixed fee to write a series of letter on your behalf, and although different than turning over the debt to an agency, this is a nice gesture.
No one wants to find them self in debt, or considered one of the people with bad credit, because it is clearly just an annoying situation for everyone involved. Having said that, this is not something that is just completely easy to avoid. With the quick and simple access to credit cards, and the constant bills that pile up, things just happen, and before you know it the debt could pile up to your chin. If you ever find yourself in a situation where you do not think you can pay off the debt quickly, there are debt collection systems that provide solid methods for bad debt recovery, but catching it early and preventing bad debt as a whole should be the ultimate goal.