The Truth of Credit

 If you can survive the barrage of phone calls and threatening letters and remain judgment-free then maybe the Statue of Limitations (SOL) has run out. On average most creditors have 6 years to file suit. Now before you think you are off the hook SOLs do vary from state to state and depending on the type of debt you owe.

The Statute Of Limitations only covers lawsuits; the expiration does not affect other types of collection action or reporting of the account to credit bureaus. The creditor or collection agency may continue with letters and telephone calls forever (although third-party collectors are subject to the “cease and desist” provision of the FDCPA.) However, they will generally put much less effort into collecting “Out-Of-Statute” debts, and may give up easily. Out-Of-Statute debts can still be reported to credit bureaus for the time limits specified in the Fair Credit Reporting Act.

Statutes of Limitations vary depending on the type of debt.  Credit cards are considered Open Accounts. Auto loans and other installment agreements are Written Contracts. If there has already been a lawsuit resulting in a judgment, that judgment has a separate Statute Of Limitations, consult an attorney regarding this.

The TRUTH is by the time the SOL comes due you will have probably been run through the “ringer” so to speak. The Collection Process is painful and is NOT supposed to easy on you. No matter how harassing you may think it is you know deep down it’s necessary.

To look up the various Statues of Limitations by State- Click Here

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