Each state has a statute of limitations on old
credit card debts and these limitations differ from state to state. The statute of limitations refers to the period after which, creditors cannot sue you to collect the debt. The length of time is calculated from your last payment date or last date of activity.
Refer to the old debts statute of limitations chart, which details the statute of limitations by Oral Contracts, Promissory Notes, Written Contracts and Open-Ended Accounts. Note that the transient nature of state legislature requires you to verify the statute of limitations period with your State Attorney’s office. Should you require more information, please visit
www.naag.org.
In the past 10 years, a growing trend has ensued, where aggressive debt collectors buy old debt accounts and actively pursue consumers to collect the debt, even though the statute of limitations has past. These are typically known as third party acquisition companies. They purchase these accounts for pennies on the dollar and hope that you will pay up. Even if, you pay $1 on the account - they still make a good profit.
This is considered a violation of your rights under the Fair Debt Collections Practices Act. Some creditors even lie and say that the statute of limitations starts from the day that they purchased the delinquent account. These companies are so bold that some of them will threaten to sue you and in fact proceed with the court case. Don’t give in to their lies. On unsecured debts, creditors can’t get what you don’t have. Others may harass you day and night, use profanity or promise to erase negative marks off your credit report, if you just send in a minimal payment.
If you find yourself in this situation here are a few tips on what to do:
Do not send in a payment - if the statute of limitations is past in your state. Sending payments will make your delinquency look recent. It will also give the debt collectors the idea that you are an easy target to receive payment from and they may attack you on other fronts.
Keep an eye on your credit report to make sure that they are not reporting negative information about you. Your old account should not be reflected on your credit report since the statute of limitations is past. If you find that they are reporting the information, take corrective action immediately by contacting the credit bureaus and fix any errors.
If possible, ignore all contact with the debt collection agency. You don’t have to talk to them.
Do not accept their phone calls. If they send you notices in the mail, you will want to keep these as proof of their harassment. Document any and all communication and correspondence with the debt collector.
The Fair Debt Collection Practices Act indicates that there are certain things that creditors cannot do in their attempts to collect debts.
Verify the statute of limitations information with your State Attorney’s office and solicit further advice on how to resolve your situation.
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