Each state has a statute
of limitations on old credit card debts. 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 activity date (this is when
you last used the card).
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.
For more information go to
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. They purchase these accounts for pennies
and hope that you will pay up. Even if, you pay $1 on the
account - they make a good profit.
This is a violation of 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 debt 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. Others
will harass you day and night, use profanity or promise to erase
negative marks off your credit repot, if you 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. Doing so, will make your delinquency look
recent. It will also give the debt collectors the idea that you
are an easy target 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 debt
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
and dispute the
credit report errors. Get your free
government credit report to monitor your credit score.
If possible, ignore all contact with the debt collection
agency. 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.
The Fair Debt Collection Practices Act indicates that there are
certain things that creditors cannot do in their attempt to
collect debt. Go to
www.poorcreditgenie.com/answers.html for a
list in plain speak. For a complete list, go to
www.ftc.gov/bcp/conline/pubs/credit/fdc.htm.Verify the statute of limitations information with your State
Attorney's office and solicit further advice on how to navigate
your situation.
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