Do Debt Collectors Have Only a Certain Amount of Time to Sue for Payments?

If you have debts, never forget about them as your debts generally do not expire or go away until you pay them. However, in many states, there is a time limit on how long debt collectors can collect your debt by being able to use legal action.

If you are asking whether debt collectors have a certain amount of time to collect payments, the answer is yes, some states have time limits on how long debt collectors can collect debts. It should be noted that each state has its own debt statute of limitations. Once that statute of limitations expires, then debt collectors will no longer be able to sue you in court for repayment. However, in some states, lenders or debt collectors can still collect on your debts that have passed the statute of limitations.

A Statute of Limitations on Debt

The Statute of Limitations for credit card debt is a law that puts a limit on the amount of time a lender or collection agency must sue a consumer for non-payment. Individual states have varying periods of time, ranging from just three years (in 13 states) to 10 years (two states), while the remaining 25 states have in-between periods of 3 years and 10 years.

Of course, the statute of limitations for credit card debt serves a purpose, which is to prevent debt collectors from taking consumers to court long after evidence of the debt has been lost or disposed of. If a lender or debt collector manages to win a court judgment against a consumer with a debt, it will likely open the door for the lender or debt collector to collect the debt by some means such as wage garnishment or property seizure.

As we said earlier that every state has a statute of limitations to prevent debt collectors from collecting older debts by using legal action. However, you should know that some debts, such as federal student loans do not have a statute of limitations. So, even if your federal student loan debt is old and past due, you should still pay it.

For your information, most states have a statute of limitations of between three to six years for debts. However, some states may have a longer statute of limitations. This can vary depending on several things, such as:

• • Debt type
  • State where you live
  • State law applied in your credit agreement

If you have a debt that has been outstanding for too long, and you are being sued by a debt collector to pay the debt, you may be able to defend your claim. Again, make sure you know the statute of limitations in your state. If your state does have a statute of limitations, then you may be able to mount a defense. In addition, you may also be able to sue the debt collector for violating the Fair Debt Collection Practices Act, which prohibits the collection of past-due debts.

We can say that a statute of limitations is a state law that sets a timeframe for lenders or debt collectors to take legal proceedings against consumers who have not paid their debts. In essence, the law does not extinguish a consumer’s debt, but only limits the period of time a lender or debt collection agency can take legal action to collect a person’s debt. As mentioned, the time frame varies from country to country, ranging from just three years to 10 years.

When that time period has passed, which means the statute of limitations has expired, it is prohibited to threaten or take legal action against consumers who have not paid the debt. However, if you have a long-standing debt, and the statute of limitations has passed, then you should not consider your debt paid off. Remember, you are still in debt. Debt collection agencies still have the right to pursue debt collection against you, of course, by not resorting to legal action, and not taking you to court over your debt case.

Types of Debt

The statute of limitations is usually applied to criminal or civil proceedings. The laws and statutes of limitations vary from state to state. This will depend on the severity of the offense committed by the offender. The statute of limitations is often applied in civil law cases involving lending and borrowing. Below are the types of debts that involve statutes of limitations:

1. Open-ended debts

Open-ended debts are debts that do not have a fixed end date for repayment, such as credit card debt or lines of credit. In this open debt, you as a debt borrower have the right to take out as many loans as you want, up to a pre-approved amount.

2. Written contract

Written contract debt is a type of debt that involves a printed or written agreement between the lender and the borrower. The agreement states the amount of money loaned, the interest rate on the loan, and the fees for the loan as well as the terms of repayment.

3. Oral contract

Oral contract debt is a type of debt that involves a spoken agreement between the lender and the borrower. Unlike the written contract type of debt, this oral contract debt agreement is only spoken, not put in writing. This type of debt is indeed considered legally binding. However, because it is not in writing, it can sometimes be difficult to prove the existence of the debt.

4. Promissory note

A promissory note represents a written promise from the borrower to pay a certain amount of money to the lender on a certain date, or at a specified time. In this type of debt, the lender does not have to be a bank, which means your friends or the company you work for can use this type of debt.

For note: Each state has varying statutes of limitations for each type of debt. Promissory notes and written contracts have the longest terms.

Read also: How Hard is It to Get a Public Trust Clearance?

Statutes of limitations by State

As a borrower, it is important for you to know and understand that the statute of limitations on debt varies depending on where you live. Connecticut, Massachusetts, Maine, and Vermont have six-year statutes of limitations on credit card debt. While neighboring states, such as New Hampshire, have a three-year statute of limitations.

Below is a chart showing the statute of limitations for each state, in number of years:

State	Open-ended debts	Written contracts	Oral contracts	Promissory notes
Alabama	3	6	6	6
Alaska	3	3	6	6
Arizona	6	6	3	6
Arkansas	5	5	3	5
California	4	4	2	4
Colorado	6	6	6	6
Connecticut	6	6	3	6
Delaware	4	3	3	3
D.C	3	3	3	3
Florida	5	5	4	5
Georgia	6	6	4	6
Hawaii	6	6	6	6
Illinois	5	10	5	10
Indiana	6	10	5	10
Lowa	5	10	5	10
Kansas	3	5	3	5
Kentucky	10	10	5	15
Louisiana	3	10	10	10
Maine	6	6	6	20
Maryland	3	3	3	6
Massachusetts	6	6	6	6
Michigan	6	6	6	6
Minnesota	6	6	6	6
Mississippi	3	3	3	3
Missouri	5	10	5	10
Montana	5	8	5	8
Nebraska	4	5	4	5
Nevada	4	6	4	3
New Hampshire	3	3	3	6
New Jersey	6	6	6	6
New Mexico	4	6	4	6
New York	3	3	3	3
North Carolina	3	3	3	5
North Dakota	6	6	6	6
Ohio	6	6	4	8
Oklahoma	3	5	3	6
Oregon	6	6	6	6
Pennsylvania	4	4	4	4
Rhode Island	10	4	10	10
South Carolina	3	3	3	3
South Dakota	6	6	6	6
Tennessee	6	6	6	6
Texas	4	4	4	4
Utah	4	6	6	14
Vermont	6	6	6	14
Virginia	3	5	3	6
Washington	6	6	3	6
West Virginia	5	10	5	6
Wisconsin	6	6	6	10
Wyoming	8	10	8	10

The chart above shows the statute of limitations for each state (in number of years). Again, remember that your debt does not go away or expire just because it was not collected by a debt collection agency within the time period set by state law. If you have not paid off your old debt, it means you still owe it. Debt collection agencies have the right to pursue you and make bad reports about your debt to credit reporting bureaus.

When Does the Statute of Limitations Period Begin?

Now, you must be wondering when the statute of limitations period starts. You should know that in some states, the statute of limitations period will begin once the required payment has been missed. But in several states, the statute of limitations period is calculated from the last payment made. If you make a partial payment on your debt, even after the statute of limitations has expired, the statute of limitations period may restart.

For example, if you have not paid your credit card debt since April 2024 and you live in California which has a four-year statute of limitations, then the Statute of Limitations will expire in April 2029. If you are bothered by debt collectors who keep terrorizing you to pay the debt, then you can decide to make a one-time payment or sign an agreement to make payments, time can start again on that date. You can check the laws in your state to find out how long the statute of limitations applies and whether payments of any kind can restart the clock.

Aside from that, the statute of limitations period may be affected by the terms in the contract with the lender or if you move to a state that has different laws regarding the statute of limitations. For this case, consult a lawyer to find out the statute of limitations for your debt.

If Moving, Which State Laws Apply to Debt Statute of Limitations?

If you move to a state that has different laws regarding debt statute of limitations periods, then you should check the agreement you signed with the credit card company. Typically, in credit card agreements there is a clause called “choice of venue.” That determines which state court will handle the conflict. Most credit card companies or debt collection agencies will file these cases in states that are most advantageous to them, such as states with the longest statutes of limitations or states where the courts side with the credit card company or debt collection agency. However, if you have a strong case, then you can argue any of them. For this case, you can consult a lawyer in your state. A lawyer will help you handle your case.

Can Debt Collectors Call After the Statute of Limitations Expires?

Yes, in most states, debt collectors can still contact you and try to collect on you after the statute of limitations has expired. Usually, debt collectors try to get you to pay your debts by calling you or sending letters. Because the statute of limitations has expired, the lender or debt collection agency cannot threaten or take legal action against you. They cannot take you to court for your unpaid loans.

Generally, a claim or suit brought by a lender or debt collection agency after the statute of limitations has expired is a violation of the Fair Debt Collection Practices Act. However, if you fail to appear and invoke the statute of limitations as a defense, the court can still enter judgment against you. Therefore, if you experience something like this, you must submit a defense. Typically, you will be asked to show that the statute of limitations has expired. Also, you may need to show that there has been no activity or transactions on your credit card for a certain number of years. If you are not sure about your case, then you can contact a lawyer for consultation. That way, you will be able to resolve your debt case without having to take legal action.