(Gary from Indiana) Is there a maximum time limit a creditor can attempt to collect a debt?
Dear Gary:
There is actually no maximum time limit for a creditor attempting to collect a debt. That being said, there are some key time lines to keep in mind as well as ways to stop abusive creditors.
Statute of Limitations
The statute of limitations prevents creditors from suing you after a “reasonable” period of time. The limit varies by state, ranging from as few as 3 years to as many as 15 years. It should be noted that the statute of limitations does not necessarily stop creditors from pursuing a judgment against you. You may still have to show up in court to mount your defense, at which point the judge will be interested to know that the statute of limitations on the debt has expired.
Your date of first delinquency starts the clock. Any subsequent payment restarts that same clock, thereby extending the statute of limitations. In some states, simply acknowledging that you owe the debt can also restart the statute of limitations.
Seven Year Credit Reporting Limit
An unpaid debt can remain on your credit report following 7 years from the charge-off date. Making a payment on an old debt resets both the statute of limitations as mentioned above as well as the length of time that the record may remain on your credit report.
Even though a negative account may not remain longer than 7 years, you may still be called about it. This is true regardless of whether the statute of limitations has expired.
If your creditor seeks and wins a judgment, then that public record can remain on your credit report for 10 years. While a creditor has the right to renew an unpaid judgment for another 10 years (20 total), this rarely occurs.
Request a Stop to Certain Collection Activities
You may, at any time, request that a debt collector cease all telephone calls in regards to your debt. The collector may still legally utilize the U.S. Mail to send notices. Of course, a spurned creditor may also utilize a court summons to get their point across.
Some debt collectors specialize in attempting to collect so-called “expired” debts. They pay just a couple of pennies on the dollar for the debt knowing that they only have to collect very few accounts in order to turn a profit. Some of these debts seem to never die, prompting some to call these creditors zombie debt collectors.
For more information on protecting yourself from overzealous debt collectors, see Debtors Unite’s tips for dealing with expired debts.
