Statute of Limitations on Debt
Let's begin by defining the very basics of the term "statute of limitations." This term refers to an enactment that sets the maximum time after an event that legal proceedings based on that event are allowed to be initiated. So, in regard to debt, the statute of limitations refers to the maximum time that a debt collector can sue you for a payment for your debt. If a debt collector does sue you after your state's statute of limitations, then they are in violation of the Fair Debt Collection Practices Act. The statute of limitations differs from state to state, and also differs according to what kind of debt agreement you have. The different types of agreements are: an oral contract, a written contract, a promissory note, and an open-ended account. Below is an quick chart that outlines what the statute of limitations is for each state (in years) according to which type of agreement you have.
Statute of Limitations for Each State (in # of Years)
|State||Written Contracts||Oral Contracts||Promissory Notes||Open-ended Accounts|
|Georgia||6||4||6||4 or 6**|
|Illinois||10||5||10||5 or 10***|
|Kentucky||15||5||15||5 or 15****|
|Oklahoma||5||3||5||3 or 5****|
the statute of limitations on a credit card is six years after the amount becomes due and payable.
contract was 5 years.
What the Statute of Limitations Means for You
So now you know the statute of limitations for the state you live in according to the type of loan you have. But you are probably asking yourself, what does it mean to me? The truth is, many collection agencies violate the state of limitations every day just because they rely on the ignorance of their debtors. They do not expect you to know the statute of limitations and the other debt laws that prevent violations, so they oftentimes take advantage of that. Because of this, it is extremely important for you to know the statute of limitations for each debt that you have in order to ensure that you are not being violated by your collectors. The mistake that most consumers make is to assume that just because the debt appears on their credit report, then it is not an expired debt. This is oftentimes not true. Knowing your statute of limitations is particularly important if your collector sues you after the statute of limitations has expired; if this happens, then you will have a very strong case against them.
In general, determining the date that your statute of limitations expires is as simple as adding the statute of limitation years to the last day that you stopped paying your bill. For instance, if you stopped paying your bill on March 20, 2013 and you live in New Jersey, then your debt expiration date will be March 20, 2019. If you think that your collectors may be violating the statute of limitations, or if you have any questions regarding your personal debt statute of limitations, then please do not hesitate to get in contact with our debt team. We have had years of experience in dealing with debt laws and statute of limitation related cases, so you can count on us to provide you with answers to your debt questions. Don't let your debt collectors get away with violating the statute of limitations − know your rights and fight for them.