California Statute of Limitations for Contracts

What is California's statute of limitations for collecting a debt?

I live in California and have recently received a summons from an attorney on behalf of a collection agency. The status of the account is "Collection Account" and the status details says, "this account is scheduled to continue on record until Jun 2010." I got a copy of my TransUnion and Experian credit reports today. Though there is nothing indicating the date of my last payment, I am almost positive the last payment was made in October of 2003. Does the statute of limitation apply to this scenario?

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Highlights


  • Understand that the passing of the SOL does not mean that a creditor cannot sue you.
  • Seek legal counsel, to verify that the SOL applies to your debt.
  • Request that a debt be validated.

Statutes of limitations for debt are often misunderstood. It is common for people to mix together the timelines for charging off a debt, the credit report reporting period for delinquent debt, and a state’s statute of limitations into one concept. My answer here will describe each of these, with a focus on California’s statute of limitations rules. Let us start with the statute of limitations.

Struggling with debt? Contact one of Bills.com’s pre-screened debt providers for a free, no-hassle debt relief quote.

Statute of Limitations For Debt in General

When a borrower fails to repay a debt, this is considered a breach of contract. A contract can be written or spoken. A breach of contract may give the harmed party a cause of action, which is a legal reason to file a lawsuit against the other party.

A statute of limitations for contract breach is, at its heart, a state's policy decision. It is an attempt by the state legislature to set the amount of time people and organizations in that state have to use the courts to resolve contract breaches. Some legislatures like Ohio set long statutes of limitations, and others like California, set short limits.

A statute of limitations for debt is an affirmative defense a defendant can use if the time for filing an action (a lawsuit) has exceeded what the state allows. In all but a few states, the passing of a statute of limitations does not prevent a plaintiff (a collection agent or original creditor) from filing an action. If the statute of limitations has passed, the defendant (the debtor or consumer) must raise this defense before the conclusion of the trial. The court will dismiss the case if it accepts the statute of limitations defense.

A statute of limitations for debt does not:

  • Prevent the filing of a lawsuit (in most states)
  • Set how long a debt can appear on a credit report
  • Allow you to ignore a court’s summons
  • Bar collection agents from attempting to collect the debt (except in Wisconsin and Mississippi)

If you determine your state’s statute of limitations for breach of contract has passed, the likelihood of the creditor attempting to file an action to enforce the debt is low. A creditor filing an action indicates either he or she believes the statute of limitations has not expired, or he or she believes the defendant will not raise this defense.

isconsin and Mississippi outlaw lawsuits against consumers in cases where those state statutes of limitation have passed. Wisconsin and Mississippi are the only exceptions to the “lawsuits are allowed for original creditors even if the statute of limitations expired” rule.

California Statute of Limitation for a Contract

According to California Code of Civil Procedure § 337(1), the statute of limitations for a written contract is four years. Under § 339(1), the limit for an oral contract is two years. See the Bills.com resource Collection Laws and the Statute of Limitations for the rules in other states. See also How to Tell Which Statute of Limitations Applies to Your Situation.

The California statute of limitations does not apply to an original creditor or collection agent telephoning or sending letters in an attempt to collect a debt. Under California law, the expiration the statute of limitations clock does not mean an original creditor cannot file an action. (The opposite is true for collection agents.) The statute of limitations clock running out does not prevent original creditors or collection agents from calling or sending you letters to try to collect the debt. In California, the statute of limitations is a defense used in a trial only.

ollection agents violate the FDCPA if they file a debt collection lawsuit against a consumer after the statute of limitation expired (Kimber v. Federal Financial Corp. 668 F.Supp. 1480 (1987) and Basile v. Blatt, Hasenmiller, Liebsker & Moore LLC, 632 F. Supp. 2d 842, 845 (2009)). Unscrupulous collection agents sue in hopes the consumer will not know this rule.

California courts allow contracting parties to modify the length of the otherwise applicable California statute of limitations, whether the contract has extended or shortened the limitations period. Extending the length must take place at the time of contract, and cannot be done retroactively.

Clock Starting & Stopping

When does the clock on a statute of limitations for a contract begin to run? In earlier versions of this answer, my writing was unclear on this subject. Under California CCP § 312, “Civil actions, without exception, can only be commenced within the periods prescribed in this title, after the cause of action shall have accrued, unless where, in special cases, a different limitation is prescribed by statute.” What does this mean?

Courts interpret and refine vague statutes. A 1992 case, Spear v. Cal. State Automobile Ass’n, is a recent decision on this matter. The California Supreme Court decided, “A contract cause of action does not accrue until the contract has been breached.” In the 1996 case Angeles Chem. Co. v. Spencer & Jones, the same court decided, “The claim accrues when the plaintiff discovers, or could have discovered through reasonable diligence, the injury and its cause.”

These cases mean that in California, the clock starts when the moment the borrower defaults on their payments. If, for example, a payment is due on June 1 and it does not arrive by that date, the statute of limitations clock starts running on June 2. Similarly, if a payment of — for the sake of argument — $100 is due on July 1 and the borrower pays less than $100, the borrower is in breach of contract at that point.

Tolling & Statutes of Limitations

Tolling stops the statute of limitations clock. These events can toll a statute of limitations in California:

  • Defendant absent from the state (CCP § 351)
  • The plaintiff was a minor (CCP § 352(a); Family Code § 6500 and 7050(e)(4))
  • Plaintiff was mentally disabled or incompetent (CCP § 352(a))
  • Plaintiff was incarcerated in prison (CCP § 352.1(a))
  • The defendant has a restitution order in place (CCP § 352.5)
  • The plaintiff or defendant die (CCP § 366.1 and 366.2)
  • State Bar takes over the attorney’s law practice (CCP § 353.1 )
  • War prevents access to the court (CCP § 354)
  • Bankruptcy, injunction or statutory prohibition (CCP § 356)
  • Voluntary agreement between the parties (CCP § 360.5)
  • Defendant’s felony conviction (CCP § 340.3(a))
  • Military service (50 U.S.C. App. § 526)
  • Delayed discovery, when plaintiff suspects or should have suspected injury
  • Various equitable tolling circumstances, including impossibility due to circumstances, interference, fraud and so on

Consult with an attorney licensed to practice in California to discuss the specifics of your situation and to help you determine if tolling applies.

Struggling with debt questions? Let the Bills.com Debt Coach review your debts and give you your options to resolving these debts.

Credit Report, Charge-Off & Statute of Limitations

The amount of time that derogatory comment on an account in a credit report is set by federal law called the Fair Credit Reporting Act. The federal credit report rules and the California civil procedure rules regarding the statutes of limitations have only one tiny connection: The length of time a judgment may appear on a credit credit report is either 7 years or the life of the judgment, whichever is longer. A California judgment is valid for 10 years, and can be renewed. Therefore, a California judgment will appear on a person's credit report for 10 years.

See the Bills.com resource Charge-Off & Credit Report to learn more about the relationship between statutes of limitations and credit reports.

Your Question

You mentioned you reside in California, your last payment was due in 2003, and you received a summons from a lawyer. You also mentioned copies of your credit reports. Be sure to check in with providers of debt consolidation in California such as this linked provider to get an evaluation.

Review your credit reports to see if the date of first delinquency is mentioned. If you stopped making payments and never restarted, this date of first delinquency is clue to the date of contract breach. Ignore the charge-off and first reported dates, as those are not significant for learning your date of breach. It is likely the statute of limitations has run its course, unless you fit into one of the tolling exceptions listed above. However, as we discuss above, a California plaintiff is not barred from filing an action if the statute of limitations has expired. Consult with a California lawyer who has civil litigation or consumer law experience to discuss how to file an answer that includes a motion for dismissal based on a statute of limitations defense.

For more information about negotiating with your creditors, visit our debt settlement information page.

For further information regarding options available to consumers struggling with debt, I invite you to visit the Bills.com debt help resources page. I hope the information I have provided will help you Find. Learn. Save.

Best,

Bill

Bills.com

273 Comments

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  • 35x35
    Feb, 2013
    Michelle
    My father is suing me in small claims court in CA. He claims that he loaned me $8K in 2006 so that I could open an IRA account. I had just received the summons of this action on Feb 28, 2013:
    1. He is making a false claim
    2. I would think that the statute of limitations has run out
    3. If he did write me a check for that amount it was only because he owed it to me
    4. There is no written/oral agreement that he lent me money
    5. I have no recollection of this.

    Please respond and I hope there is a God in heaven... Thank you MM

    0 Votes

    • 35x35
      Mar, 2013
      Bill
      My first and last thought here is a strong recommendation for you to consult with a lawyer who has civil litigation experience. My second thought is related to the claim amount. You mentioned the California small claims court. The statutory limit for a case in a California small claims court is $7,500. If the amount in controversy — the loan amount plus a reasonable amount for interest — is greater than $7,500, a California small claims court has no jurisdiction over the case, and should dismiss it. If it does not, you should consult with a lawyer to discuss filing a motion to dismiss. On to your questions:
      1. Consult with a lawyer to write answers to the complaint.
      2. The statute of limitations clock may have run out. It doing so does not preclude the plaintiff from filing an action. The expiration of the statute of limitations gives you, the defendant, an affirmative defense you can raise in a motion to the court. An statute of limitations affirmative defense is where you would tell the court words to the effect, "Even if everything the plaintiff states is true, based on the dates the plaintiff provides, his claim is time-barred under California Code of Civil Procedure § 337(1)." If you fail to raise a statute of limitations defense, the court will consider it waived. In other words, a court will not raise a statute of limitations defense for you and dismiss a case for this reason unless you ask it to.
      3. Again, a lawyer can help you create an answer to the plaintiff's allegations.
      4. You need to state that no contract existed between the parties in your answer to the complaint. If you do not deny an allegation in a complaint, the court will consider the statement as an accurate fact.
      5. The plaintiff must prove his or her case using relevant evidence. The defendant's job is to defend his or herself by making sure the plaintiff proves each of his or her statements of fact. Deny what is false in your answer to the complaint.

      It is distressing to learn one is the defendant in a civil lawsuit. It must be doubly so to learn the plaintiff is your father. If you cannot convince him in an out-of-court meeting to dismiss the case, then you need to defend yourself or you the court will issue a summary judgment against you. As I mentioned at the top of my reply, consult with a lawyer who can guide you though the process.

      0 Votes

  • 35x35
    Feb, 2013
    chris
    I received a settlement for damages and personal injury from an insurance company following a car accident in which the other driver was at fault. After the accident I saw a physical therapist for some back pain that was covered by my personal insurance. Now ACS Recovery Services is asking for some of my settlement money back on behalf of my medical provider because I was "paid twice". The accident was in March of 2007, and ACS has been wishy-washy in contacting me, always threatening to pursue further legal action, but not actually doing so. When this started, and I tried to return their calls, no one answered and it took over a month to call me back, so obviously they don't really want the money that bad. They claim they are not covered by a statute of limitations (CA). How do I get them to leave me alone?
    0 Votes

    • 35x35
      Feb, 2013
      Bill
      The next time the collection agent you mentioned contacts you, gather the caller's name, his or her employer's company name, street address, and general phone number. Then send the collection agent a cease communications notice. Should the collection agent file a lawsuit against you, consult with a lawyer who has consumer law experience immediately. Never ignore a summons.
      0 Votes

  • 35x35
    Feb, 2013
    David
    After 47 agonizing months of undergoing a loan modification on our California home, my lender finally offered us a trial loan mod. Why, all of a sudden did they offer this? The lender's letter has provided no details such as principle reduction, extended terms, tax inclusion, etc, simply instructions to make a slightly lower monthly payment commencing on 1 March. Could it be that because we are approaching month 48, which reaches the end of the 4 year California Statute of Limitations? We are very concerned about making this payment, starting the clock ticking again, and would like to know if we have a chance of having a portion of the mortgage loan forgiven, or at least forgiveness of the deficiency payments of nearly $400,000 over the past 47 months of non-payment (loan mod requirement). Your assistance is greatly appreciated.
    0 Votes

    • 35x35
      Feb, 2013
      Bill
      Consult with a California lawyer who has experience negotiating mortgage modifications before you send the lender a dime, or otherwise acknowledge the debt formally. Your analysis regarding the California statute of limitations motivating the lender or its mortgage servicer to send you an offer could be correct, or it could be acting because of the National Mortgage Settlement California it signed a year ago. Or, it could be simple incompetence caused the delay until now.

      Regardless of the reasons behind the servicer waking up, you now have the worst possible offer presented to you. The servicer displays an enormous amount of chutzpah to expect you accept a modification without disclosing its terms. As mentioned at the top of my answer, ask a lawyer to reply to the offer on his or her letterhead so that the servicer is put on notice it must negotiate in good faith.
      0 Votes

  • 35x35
    Feb, 2013
    Joshua
    In 2007 my apt went into foreclosure and was sold at a court hearing here in California. In 2008 and ever since then I've been getting phone calls from a collections agency (Vital Recovery Services) for the second mortgage on the property which is about $20K. They've tried to settle before (last year) for about $1,500 and even that was too much for me to pay and I told them but they didn't respond. So every now and then they call and leave a voice mail. It's been 6+ years since the foreclosure and I was wondering if these guys can still come after me with a judgement or not. and If they can, will they let me know before they file for a judgments or once they do is it already too late? My credit report shows a charge off for the past 6 years and I think that will fall off in another year or so. What do you think? Thank you
    0 Votes

    • 35x35
      Feb, 2013
      Bill
      If I read CCP Section 580a correctly, the mortgage lender or its collection agent has three months to file an action to collect a deficiency balance. In other words, the statute of limitations for a California deficiency balance is ~90 days. Let us say I misunderstand CCP Section 580a. If so, then California's 4-year statute of limitations for a breach of contract applies.

      In most states, it is never too late to file a lawsuit for a breach of contract. However, all states have a statute of limitations defense consumers can raise at the time of trial. If the court believes the facts and accepts the statute of limitations argument, it will dismiss the case.

      You mentioned the foreclosure occurred in 2007. If the creditor or its collection agent files a lawsuit against you today in 2013, consult with a lawyer who has civil litigation experience, and discuss raising a statute of limitations defense. Note that if you are sued, you must take action by raising the statute of limitations defense! The court will not do so for you. Never ignore a summons.

      The next time the collection agent contacts you, gather all of the contact information you can about the collector, including the caller's name, his or her employer's mailing address and telephone number. Then send the collection agent a cease contact notice via Certified Mail. Keep copies of all documents relating to the debt in a separate file folder in a secure place. If the collection agent keeps calling you, consult with a California lawyer who has consumer law experience to discuss filing a lawsuit against the collector for violating the Fair Debt Collection Practices Act. To learn more about your rights as a California resident, read the Bills.com article California Collection Laws.
      0 Votes

  • 35x35
    Jan, 2013
    Skyler
    I inadvertently created a debt with AT&T on a land phone in 2006 and was never aware of it (moved into a new residence and somehow assumed the contract from previous tenant). In May 2012, AT&T sold this $212 debt to a collection company. Neither AT&T nor the collection company ever contacted me. In January 2013, I applied for a mortgage to purchase a home. My credit report now shows that the collection company reported the debt for two months (June and July 2012) and then stopped. I just called them and they gave me details about the debt that I did not know before. QUESTIONS:
    1. With close to 6 years having elapsed from the date of this debt, am I still liable for it?
    2. Is there any way short of taking them to court that I can get the Collection Company to agree to write a letter stating that they are no longer pursuing me for this outdated debt and agreeing to delete the negative information from my credit report?
    0 Votes

    • 35x35
      Jan, 2013
      Bill
      1. Yes, you still have liability for the debt even though the statute of limitations has passed in all states but two. The original creditor or a collection agent that buys your account can file a lawsuit against you. If you do not mount a defense, claiming that the SOL has expired, the creditor will win a default judgment against you. I will assume for the sake of argument the debt was incurred while you were a California resident for a California landline. California's statute of limitations for a breach of contract is 4 years. In California, because the debt is older than the state's statute of limitations, you still have liability for the debt, and it can be reported on your credit reports up to 7 years after the date of first delinquency. See the original article above for a longer discussion of this issue.
      2. Call the collection agent and discuss the idea you mentioned here.
      0 Votes

  • 35x35
    Jan, 2013
    Teresa
    This past week my husband received a letter in an attempt to collect a debt from a collection agency for $15,139.58. The supposed creditor is a company we have never heard of before. I have been taking care of all of our bills / debt for the past seven years and during this time we have not gotten any loans or credit even close to this amount. This weekend we checked his credit report with all three agencies and they look great. There are absolutely no listings from this company or any collection or negative comments on his report. For that matter they have not been on any of the credit reports we have reviewed over the past seven years (even prior to buying our house). I did notice though that the collection agency did do an inquiry back in October 2012 with one of the credit reporting agencies. The only thing my husband can imagine that this might be would be from a car that was repossessed in 1999 (when he was married the first time); he doesn't remember the name of the loan company from then since that was almost 14 years ago. Should we do anything about this? Or just wait and see if anything develops? We are thinking that it could be a scam of some kind too.
    0 Votes

    • 35x35
      Jan, 2013
      Bill
      Validate the debt immediately by following the instructions on the hyperlink I just mentioned. A debt that cannot be validated may not be collected. The debt validation (or lack thereof) will give you more clues to the origin of the debt, and if your spouse is even the debtor.

      Do not put too much stock in the fact a debt does or does not appear in a credit report. A credit report is not a complete or accurate record of a consumer's every debt because creditors have the option to report an account to the consumer credit reporting agencies.
      0 Votes

  • 35x35
    Jan, 2013
    Tracy
    I received notification via a debt collector that I had an unpaid balance due from a revised final phone bill from 2003. When I moved I left a forwarding address and they never sent anything. Now 10 years later I get a letter (that was sent to my mother's house, which at the time was my forwarding address) that I owe them money. My concern is that if I don't pay it will it be reported to any credit agency?
    0 Votes

    • 35x35
      Jan, 2013
      Bill
      A delinquency like the one you described may appear on a credit report for up to 7 years from the date of first delinquency. This rule is spelled out in a federal law called the Fair Credit Reporting Act. If, as you suggest, the date of first delinquency was 10 years ago, an original creditor or collection agency would violate the FCRA if it would report the debt as current.
      0 Votes

  • 35x35
    Jan, 2013
    Timothy
    Around June of 2010 or maybe earlier (I don't know exact date because my e-mail deleted the notices...) I was scammed into buying iPhones for AT&T and was promised that after the purchase my account balance would be credited off and the account would be closed. Several of my friends had done this but I guess when processing mine something went wrong. Now I have a collection of $1,400 that I guess was reopened AGAIN 4 months ago and the balance today is $1,707. One of my credit repair friends told me to contact them and try to settle for $200 and when I heard that I thought it was a joke but he told me he was serious because they buy the debt 10 cents per dollar or something. I was wondering what my options are and when the the statute of limitations started, was it when i got scammed into making AT&T or when the AT&T sent the debt into collection, or when they reopened the collection 4 months ago. FYI I was about 18 when this happened.
    0 Votes

    • 35x35
      Jan, 2013
      Bill
      It is unclear from your message if you possess the iPhone(s). Companies do not give away handsets, whether they are iPhones or no-name cell phones. If you don't have the phone you were the victim of a scam and you should pay nothing because you are the victim of a crime.

      If you do have the iPhone(s), you were expected to pay for its (their) cost as a part of your monthly service fee. It is also possible I am misunderstanding the facts you shared.

      Your question centers on statute of limitations. In most states, the statute of limitations starts when you breach the contract. Here, if you never made a payment, your statute of limitations started sometime in July 2010. If you were making payments, the statute of limitations started the month you stopped making your payments. The date the original creditor sold the debt, or any other dates are irrelevant.

      You ask your question on a page discussing California law. If you are a California resident, review the original answer above for a longer explanation of California's statute of limitations rules.

      You asked about your options. Read the Bills.com resource What are my debt resolution options? or access the no-cost, no-gimmick Debt Coach tool to see the costs for each of your debt resolution options.
      0 Votes

  • 35x35
    Jan, 2013
    Rachel
    My husband attended National University in San Diego, CA. The last class he took was in 2007 and since then, he has not made one payment. That was more than 5 years ago. He never received contact from a collection agency.

    This week, he received a letter from a debt law office, asking for a settlement offer. Since this is well past 5 years, can he be responsible for this amount? It is over $6K that he owed National University. If the statute of limitations has passed, does he still need to pay this? Can it go on his credit?
    0 Votes

    • 35x35
      Jan, 2013
      Bill
      My answer assumes this debt is related to either a delinquent tuition fee, or a delinquent private student loan.

      In California, the passing of a statute of limitations for a breach of contract does not mean the creditor may not collect the debt. It means the debtor has an affirmative defense available if the creditor files an action (a lawsuit) against the debtor. If the original creditor or a collection agent files an action on a California debt that is older than 4 years, the consumer should consult with a lawyer immediately to discuss raising the statute of limitations affirmative defense.

      In California, debt does not go away or become uncollectable unless the original creditor or the collection agent who buys the collection account forgives or cancels the debt.

      What to do here in the circumstances you described? Send the collection agent a Cease Communication Notice. Should the collection agent follow-up with a summons and complaint, then consult with a California lawyer who has consumer law or civil litigation experience.

      You asked about credit reports. See the Bills.com resource Fair Credit Reporting Act to learn more about what can appear on a credit report and for how long.

      At the top of this reply I made a big assumption. If this debt is related to a federal student loan, read Federal Student Loan Default to learn your options.
      0 Votes

  • 35x35
    Dec, 2012
    Darla
    I had an old debt, which I always thought I would take care of it. I paid on the debt until July of 2009. At that time I was unable to do so, had a baby and finances went south. It was with a bank for a credit card, which they wrote off for $680 Feb 2010. The account was opened in 2004. Apparently it was sold to a collector, and they never contacted me until today. Some girl came to my home and asked for me, Darla S****. She didn't tell me who she was, which company or anything, simply she was giving me a summons.

    I reviewed the summons and there is no court date. It's the debt I know about. My question is, or course I need to pay it, and financially unable (don't work, no income). My late payment stated on Aug 2009, and SOL would mean Aug 2012, which is tricky I suppose.

    I think the court docs are fake, because I searched it several times (several pages) for a court date and nothing appears. I am guessing this is the way of the creditor wanting me to call, not going to happen. I've NEVER heard or received anything from them. I had only dealt with my original collector, who told me it was written off and not to worry. Obviously that was wrong. This is my only debt EVER, just things got out of hand with medical issues. What can I do about a court date? Shouldn't the doc have a court date? Thank you!
    0 Votes

    • 35x35
      Dec, 2012
      Bill
      Without seeing the documents you received, it is impossible to say whether they are a summons and complaint or a elaborate ruse. The best person to answer your question is a California lawyer who has civil litigation experience. You mentioned you have no income. Call your county bar association and ask for the names of the organizations that offer low- and no-income people in your area no-cost (called pro bono) legal services. Make an appointment with the organization that is closest to you or you feel is most likely to meet your needs. Bring all of the documents you have relating to the debt to the meeting. The lawyer you meet will tell you if the summons is legitimate or a fake, and your options for responding to the summons if it is real.

      Filing a lawsuit for a $680 debt may seem ridiculous, but I have seen original creditors and collection agents file lawsuits for debts of less than $500.
      0 Votes

  • 35x35
    Nov, 2012
    Tina
    My supervisor received a call today from a man who asked her to confirm that she was in fact my supervisor, requested our fax number and left a message for with a # and a contact name and a Case #. I'm unsure why they didn't ask for me from the start as I was available? I called them back immediately and his first question was if I have received a summons. I told him no and he went on explaining that he was hired buy a man, whom I never heard of regarding a credit card issued to me in 2007 and went into default in 2008. He said they have my last known address at a residence I haven't lived at for over 20 years. He mentioned wage garnishments and pending legal actions. Gave me the name of the credit collections that had this debt and asked if I wanted to take care of this now and he could then stop all legal proceedings. I believe he was trying to intimidate me and I refuse to pay anyone anything without verification of debt. However this debt is so old I was wondering what you thought of this? Are these actions that can be taken? If I am understanding what is said in your post the statue of limitation has been met and the fact that I have not been contacted regarding this debt ever has me a litte confused. The man confirmed he has my current address, yet has never sent me any letters?
    0 Votes

    • 35x35
      Nov, 2012
      Bill
      The facts you shared sound very odd, indeed. Assume you are dealing with a fake debt collector who is trying to scam you. Follow the hyperlink just mentioned to learn how to handle this caller.
      0 Votes

    • 35x35
      Dec, 2012
      Wayne
      Legitimate debt collectors do not act as you described. You're dealing with a bully who wants to embarrass you into acting quickly to pay them something.
      0 Votes

  • 35x35
    Nov, 2012
    W
    Does it mean a collection agency/debt collector can still call me for collections even if the statute of limitation has already expired? How long it would take for them to stop calling or mailing collection letters? Also, they tried calling one of my cousin's cell phone number to look for me? I'm so clueless how they even got that person's number and asked for me? I'm sure my cousin was never involve with any of my accounts. Please advise if you have any clue.
    0 Votes

    • 35x35
      Nov, 2012
      Bill
      • In California, the passing of the statute of limitations for a breach of contract does not mean the original creditor or a collection agent must stop attempting to collect the debt. See the original answer above for a longer, more in-depth discussion of what a statute of limitations means for consumers.
      • It does not matter how the original creditor or the collection agent found your relative's telephone number. Under the Fair Debt Collection Practices Act, a collection agent is allowed to contact a consumer's neighbors or relatives in an attempt to learn the debtor's contact information. The collection agent is not allowed to discuss the account with a consumer's friends or relatives.

      You mentioned the statute of limitations has passed on this debt. If so, consider sending the collection agent or original creditor a cease communications notice.

      1 Votes

  • 35x35
    Nov, 2012
    J
    I have two credit cards that I opened both in 2006 and have defaulted in 2006 as well. I was in high school at the time one card was for $300 and the other for $400. collectively I owed $600 or so with both of them. Those have been the ONLY credit aside from hospital bills I ever had. I checked my report recently and see that I owe $0 on one and $900 on another plus two other accounts that are both over $1200. I do not know who they are or what I owe because I have stopped using credit since 2006. What do I do. I have not received any mail, calls or subpoenas so I am so confused. Is there a way to get rid of the negative affect of $0 credit debt being reported on my FICO and what about the other credit card? Where did the other debt come from and is there a way get rid of them if possible? Thank You
    0 Votes

    • 35x35
      Nov, 2012
      Bill
      I have three reading assignments for you that will answer your questions:
      • You need a basic understanding of what can be reported to the consumer credit reporting agencies (the credit bureaus), and the rules that control how long a derogatory (a negative event, such as missed payment) can appear on a consumer's credit reports. See the Bills.com article Fair Credit Reporting Act to learn more about what can appear when on your credit report.
      • You mentioned a mystery account appearing on one or more of your credit reports. If the account is an error, file a dispute with the creditor reporting agency or agencies that report the error.
      • Read How Your FICO Score is Calculated to learn more about the elements that go into your FICO credit score.

      Please ask any follow-up questions on the most appropriate page.

      0 Votes

  • 35x35
    Sep, 2012
    Sandra
    We have several accounts that we have not paid on since 7/2008 I did receive 1 wage garnishment, which I'm paying. My husband recently has paid $30.00 a month on a collections account and now received an attempt to levy checking account. Can they do this? We have sent over $280.00 so far and they only have a credit of $175.00 on paperwork filed with the court! We have about 9-11 accounts in collections and all the sudden they are calling cell phones to attempt to make payment arrangements. We filed bankruptcy 13 in 1999 then 2001 we converted to ch 7. Can we file bankruptcy 7 again? Before more wage garnishments?
    0 Votes

    • 35x35
      Oct, 2012
      Bill
      Regarding the wage garnishment and account levy, the creditor is not barred from using wage garnishment, account levy, and liens simultaneously.

      A debtor is qualified for a new chapter 7 if they received a discharge under a Chapter 7 or Chapter 11 case filed 8 or more years before the second petition is filed. If the previous bankruptcy was a chapter 13, 6 years must pass. If your chapter 7 was discharged in 2001, 2002, or 2003, you qualify today for a chapter 7.

      Consult with a lawyer in your state who has bankruptcy experience to discuss your options.
      0 Votes

  • 35x35
    Sep, 2012
    Melinda
    I just got a call from a guy that said he was calling on behalf of a law office about a debt to CashCall that was taken out 8 1/2 years ago and never finished paying on...my ex husband verbally told me that he would take care of it and I never checked to make sure he took care of it. They are wanting me to settle with them.I have been remarried for 7 years and they did not even have my new married name! Am I still responsible for this debt? Can they really sue me? I do not have the money to talk to an attorney..hasn't the time for them to sue me ran out and why are they contacting me now?
    0 Votes

    • 35x35
      Sep, 2012
      Bill
      They can sue you, but you can likely use the statute of limitations as an affirmative defense. Don't give them a penny, as that can restart the clock on the SOL. Although you can't afford an attorney, try to seek legal counsel through a legal aid society in your area.
      0 Votes

  • 35x35
    Sep, 2012
    Laura
    I broke a rental lease agreement in May 2008. I had to move because of safety reasons due to the fact another tenant threatened me and others with a knife. A police report was taken, but the offender not arrested. I had signed a one year lease in April 2008. The balance of the lease monies appears as a Derogatory Other opened 7/2009, reported 8/2012. They never served me with any Judgement papers or tried to make contact. I thought that under the law I had a right to move and do not owe them anything?
    0 Votes

    • 35x35
      Sep, 2012
      Bill
      Landlords have a duty to provide what the law calls "quiet enjoyment" of the property, which in the past was considered the landlord not interfering with the tenant's right to possess the property. However, courts have stretched that to mean the landlord has the duty to provide safe common areas.

      If the other tenant's behavior was a surprise to everyone and one-time event, then it is likely a court would not look favorably on your quitting the lease. On the other hand, if the landlord had notice the tenant had a history of violence to others in the building and took no action, then a court would likely see your quitting the property as reasonable. Which of these hypothetical situations would a reasonable observer of what happened in May 2008 say matches your situation?

      Under common law, a landlord must make reasonable efforts to lease a property when a tenant quits before the end of the lease term. It is not reasonable for the landlord to report the remainder of the lease as an amount due on your credit report.

      My advice? Dispute the derogatory in your credit report.
      0 Votes

  • 35x35
    Sep, 2012
    svan
    Hi I was served with a summons on July 2012 for a credit card debt I was unable to pay. what can I do? Do I hire a lawyer? Do I show up to court with cash to try and settle a payment? Please help me
    0 Votes

    • 35x35
      Sep, 2012
      Bill
      First, my default answer for anyone who asks, "Should I talk to a lawyer?" is always, "yes."

      Second, it is common for parties to resolve their dispute before trial. It saves time for the courts, which are usually overloaded, and it allows the parties to save money on lawyers fees. Out-of-court settlements are better for everyone, assuming both parties are reasonable.

      If the amount the creditor demands is incorrect, or if you cannot reach a reasonable out-of-court settlement with the creditor, then attend your hearing, explain your side of the argument to the court, and back it with evidence.

      See the Bills.com article How to Answer a Summons & Complaint to learn more.
      0 Votes

  • 35x35
    Aug, 2012
    F.
    A collection agency (using a false business name, I assume) filed a small claims court against me in California at the end of June 2012. The Statute of limitations ran out in July 2012. My question is, does the statute of limitations only apply to filing the lawsuit, or am I protected from them collecting the money from me since the 4 years is now up?
    0 Votes

    • 35x35
      Aug, 2012
      Bill
      In general the statute of limitations is the time allotted to file an action (a lawsuit). If this was done within the time allowed by California law and you do not mount an effective defense, then a public judgment may be issued against you and you will be liable for paying the debt and possibly subject to wage garnishments, bank levies, and personal liens. Because a plaintiff filed an action against you, I recommend you consult with a lawyer who deals in consumer law, so you can prepare an effective defense.
      0 Votes

  • 35x35
    Aug, 2012
    M. D.
    Hi, I received a phone call from a company hired by a collection agency about a pay day loan from March 2005. They would not give me any information regarding this debt from a company I never heard of. I have not lived at the address that they have on file since 2006, I have not received any information or notices regarding this matter, they claim to have mailed me all the information to the old address and the legal summons. what is sthe statued of limitation in this matter
    0 Votes

    • 35x35
      Aug, 2012
      Bill
      Statute of limitations issues can be tricky. For instance, you could have taken some action, like being out of the country for an extended period of time, that "tolled" the time on the statute.

      The SOL for a written contract in CA is 4 years. If you have made no payment on the debt for 4 yeras, it is likely that the SOL has expired. That does not mean that collections can't continue. It would mean that you can use the SOL as a defense, if you are sued. You have to go to court to make your defense, if you are sued, or a default judgment could be entered against you.
      0 Votes

  • 35x35
    Aug, 2012
    BlueFish
    Hi, I am gathering my paperwork about a charge from verizon for $234, that went onto collections in Feb 2007. Can I remove the charge-off from my credit report, and how do I go about doing it? I had internet through verizon, starting July 2006. When signing up with verizon, I also applied for a public assistance program (need to check my record for details on name etc.) that gives credit to your monthly internet bill if you have low income. From August 2006- January 2007, Verizon sent me the bill and in each statement, there was the credit applied from the public health program. Then, I received a bill in February 2007 with the charge of $234 BACKBILLED for the duration of service because it turns out I was not approved for the public assistance program. I did not know I was not approved. My contract with verizon was month-to-month, and the service was terminated. I called and asked to split the payments over 6 months, and they refused. I was in college, had no money, I was refused because I am on my parents taxes. I made a mistake and instead of asking my parents for help, I thought I can figure this out on my own. I couldn't come up with the money in the next year, and had close to a nervous breakdown during that year due to personal problems, and school. It's been nearly 6 years. I want to pay off the money, but will it renew the date of collections on the report? Please, I have tried really hard to keep my record clean. I will be applying for graduate school for my masters, and will need to take out a loan. I sent a letter last year to the collectors, offering to pay the full amount, if they delete the record from my credit report. I got no response. I received letter offering half th sum, to settle. I read settling is not good either! I am confused what I can do? If I dispute with the credit bureau, can I claim that the charge was somehow wrongful because it happened as a backbill, and the statements were misleading into making me think the program was in place, and effective?
    0 Votes

    • 35x35
      Aug, 2012
      Bill
      Disputing a delinquent account with a balance due with the credit reporting agencies — Equifax, Experian, and TransUnion — is rarely an effective strategy to improve your credit score.

      Consider a pay for delete where you settle the debt in exchange for the collection agent removing the derogatory account from your credit report. Read the article I just mentioned to learn more.

      You mentioned applying for a student loan. Federal student loans are based on need, and not your credit score, so if you are unsuccessful in negotiating a pay-for-delete, this should not matter to the Dept. of Education. For what it is worth, I recommend a federal student loan over a private loan.
      0 Votes

  • 35x35
    Aug, 2012
    Fran
    I just learned today, that a law firm filed a judgment against me in 8/2009. There was a court date, however, I was not aware and therefore, I did not go. The court date was held in a city in California that I use to live in. However, I had moved from that city for more than a year prior to the court date. Is it possible that they served me at my old address by placing it in mail box. I want to know do they usually file the judgement in the city you currently live in if they are aware? Now they are requesting to reinforce the judgement from 2009, that I was in default on for not appearing and they are asking me to respond to them in 10 days. Can I request a copy of the notice they service from the courts? I plan on getting an attorney, but I want to know my rights. My sister was served a notice in her mailbox before and the server claimed he served her by hand. I definitely would have went to court on this case because the SOL had expired and there were no tolls that applied to this acct.
    0 Votes

    • 35x35
      Aug, 2012
      Bill
      The first two sentences in your message lead me to this word of advice: Consult with a lawyer who has civil litigation or consumer law experience immediately. Based on the facts you shared here, you have grounds to file a motion to vacate the judgment based on the plaintiff (the party filing the lawsuit against you) failing to give you adequate notice of the lawsuit. Our civil court system is based on the idea that both parties are fully aware of the other's actions regarding a legal dispute between the two. If the plaintiff fails to give the defendant adequate notice, which is described in detail in your state's laws, the civil court system falls apart.

      It amazes me plaintiffs cannot seem to deliver service of processes to defendants at their accurate addresses, but later, when plaintiffs have judgments in hand, they find defendants' accurate addresses.
      0 Votes

  • 35x35
    Jul, 2012
    Marc
    I had an open book account that was closed by the credit card issuing bank in August 2007. I made sporadic payments but the account remained closed and was eventually charged off in March 2008. I've been sued by an attorney representing a collection agency. I've already answered the complaint and the plaintiffs discovery. Where does the SOL in California stand on this matter?
    0 Votes

    • 35x35
      Jul, 2012
      Bill
      First, please see the "Clock Starting & Stopping" section above for a general discussion of when the statute of limitations for breach of contract clock starts in California. Second, consult with a lawyer who has civil litigation experience to learn a precise answer to your question. Given the fact you made sporadic payments in late 2007 or early 2008, makes it unclear to me when the contract breach occurred. A lawyer will review the evidence you provide, and create an argument you can use when filing a motion to dismiss.
      0 Votes

    • 35x35
      Jul, 2012
      Marc
      I'm consulting with an attorney this afternoon. The account was closed after non payment in August of 2007 - the card was never reopened or used after that date. Payments were made less than the lowest amount owed in six of the following eight months with the final payment being made in March 2008. I have documentation from credit reporting agencies that the account was closed from August 07 and then charged off in March 08. The plaintiff claims the breach of contract occurred from the date of last payment in March 08, my argument is the contract was breached and account closed 8/07. We will see what the attorney makes of this.
      0 Votes

  • 35x35
    Jun, 2012
    R
    Collection agencies keep calling me on debt that is more than 8-9 years old. These debts do not show up on my credit report anymore but they are still calling to collect. What are my possible options in stopping the collection companies from calling? Thanks in advance.
    0 Votes

    • 35x35
      Jun, 2012
      Bill
      The next time the collection agencies call, ask for their addresses. Then send them a cease communications demand letter by Certified Mail so that you have a record of your doing so. Keep careful records of when and where you send these letters. If the collection agencies follow federal law, they will not contact you again.

      However, not all collection agents follow the law, and consumers file more than 800 lawsuits per month against collection agents who, consumers allege, violate the law.
      0 Votes

  • 35x35
    Jun, 2012
    Tom
    I made the last payment on my credit cards in 12/2008. I moved to Asia to teach because I could not find a job in the U.S. I am from California. Even though I have not made a payment in 3.5 years, "tolling" means that when I left California, the statute of limitations clock did not tick, so that even if I wait here until 2013 I cannot use the SOL defense. Is that correct?
    0 Votes

    • 35x35
      Jun, 2012
      Bill
      You can make a statute of limitations defense argument. However, if your opponent is on the ball and asks you the right questions in discovery, he or she will uncover your extended absence from California. If your opponent knows the law as well as or better than you, he or she will argue to the court the statute of limitations was tolled during your absence and your argument does not apply given the present set of facts.

      This is a tricky issue because you must be certain to make accurate, factual, and non-misleading statements to the court. In other words, never lie to the court. However, in a civil matter, you need not volunteer information your opponent does not request.
      1 Votes

    • 35x35
      Jun, 2012
      Ken
      Yes, physical absence from the state tolls the statute of limitations. In the event the creditor sues you, you need to tread very carefully when using the statute of limitations as an affirmative defense. First of all, it is rather routine for a creditor to file a rebuttal when a SOL defense is raised. Secondly, it is not at all difficult for a motivated creditor to determine that you were absent from the state for a protracted period of time. Since any filing you make in a lawsuit is made under penalty of perjury, you could find yourself paying your creditor out of your jail commissary fund. Judges in California get mighty upset when they are lied to or misled.
      0 Votes

  • 35x35
    Jun, 2012
    DEBORAH
    Question: I disputed an item on my credit report 2 years ago. I asked the creditor for the contract I supposedly signed. All they gave me was the electronic unsigned version of what they received from the original creditor. The first date of delinquency was reported in 2006, then of course collection agencies took over from there. I have disputed this with the 3 credit agencies, yet no-one is complying with my request. It's frustrating because I see a lot of comments on the statute of limitations and that I can be sued by the collection agency that now has the account. This is not right. Chase (the original creditor, whom I have never done business with) will not cough up the signed contract showing my signature. How long can this cat-and-mouse game go on? Can I still be sued for them not complying with my request for documents? Please help — very frustrated! I cannot afford an attorney to deal with this.
    1 Votes

    • 35x35
      Jun, 2012
      Bill
      You mix two separate but related issues. First, reread the original answer above to review how and when to apply the California statute of limitations affirmative defense.

      Second, read the Bills.com article Debt Validation, and in particular, the section "What is Proper Validation?" to learn more about debt validation. In general, a collection agent may not collect a debt it does not validate. However, the threshold for what courts consider proper validation is very low.

      My advice? As mentioned, you have two reading assignments. After reading both articles, follow-up with any questions you may have on the most appropriate page.
      0 Votes

    • 35x35
      Jun, 2012
      Ken
      As aptly mentioned, the threshold for proper debt validation by a creditor is very low. Specifically, as upheld by multiple US appeals courts, a debt collector does not have to provide anything more than a written statement that they have confirmed the account with the original creditor and recap the amounts involved. It is a myth they need to provide account statements, original contracts, or other evidence proving you entered into a contractual agreement with the original creditor. Those who state otherwise are only hallucinating about what they would rule should one day they get appointed to the federal bench.
      0 Votes

  • 35x35
    Jun, 2012
    Art
    I had a HELOC that I opened in 2006 and I haven't made a payment on it for about 5.5 to 6 years. The amount was $151,524 and the account has been charged off for a while. The HELOC bank isn't the same bank that I have my primary mortgage with. My questions are:
    1. Can the HELOC bank touch my house or put any kind of liens on my house?
    2. Can anyone sue me?
    3. Should I file for chapter 7?
    4. Since I don't make enough money at all to make any payments or even try to settle it, how much longer until I can completely remove this from my credit report legally?
    0 Votes

    • 35x35
      Jun, 2012
      Bill
      It is difficult to answer your questions with precision without knowing more about your situation. What is today's market value of the property in question? What is the balance of your senior deed of trust (mortgage)? Is the HELOC a purchase money loan, or did you open the HELOC after purchasing the property? Here are the best answers given the information available:
      1. Because you stopped making your monthly payments, the HELOC lender has a cause of action against you for breach of contract. If the lender files an action, you may raise a statute of limitations affirmative defense and ask the court to dismiss the case. If you fail to defend yourself, the lender will win a default judgment. The judgment would give the lender the right to garnish your wages, levy your financial accounts, and place a lien on your other property.

        It almost certainly still has the right to foreclose.
      2. Anyone with a cause of action against you can file a summons and complaint with a court that has personal jurisdiction over the parties, and subject matter jurisdiction over the controversy.
      3. Consult with a bankruptcy lawyer to discuss a chapter 7 or 13. It is impossible for me to say whether a 7 or 13 would be the best option for you, based on the available information.
      4. I am uncertain how long a delinquent junior deed of trust / second mortgage can appear on a credit report. My guess, note that word choice, is 7½ years from the date of first delinquency.
      0 Votes

    • 35x35
      Jun, 2012
      Ken
      Look for an acceleration clause in the HELOC contract. This could adjust the outward date of your first delinquency and, thus, the credit reporting time period. Further, I would think it exceptionally unlikely that a creditor owed $150+k would have let the statute of limitations expire. There may already be judgments / liens against you that you are unaware of. A common mistake made when a HELOC is with a bank different than that which holds the first mortgage is that the two are separate animals. They are almost always linked in one crucial way: your original mortgage contract will almost always contain an acceleration clause which places you in automatic default when your first mortgage holder's position is threatened or when you are in default of other credit obligations -- especially a subordinate loan on your home. That means that the first mortgage holder can call your total mortgage when they learn of your HELOC default. Depending on the market value of your home, the total debt owed and the California homestead exemptions, you may or may not lose your home if you file for bankruptcy.
      0 Votes

  • 35x35
    Jun, 2012
    Tammy
    I stopped paying on my credit card debt in January of 2010. We simply could not afford to pay when my wife lost her job. We currently live and have always lived in California. I have a few questions I was hoping you could help me out with. 1. How long does the credit company have to file a lawsuit to attempt to collect the debt? We stopped paying in January 2010. 2. When will the delinquency be off our credit report, and no longer affect our ability to get a home loan? 3. If a lawsuit is brought by a creditor and were forced to file bankruptcy at that time when will the debt be eliminated from our credit report?
    0 Votes

    • 35x35
      Jun, 2012
      Bill
      Let me address your three questions.
      1. In California, a creditor can sue you, even after the SOL has expired. If that happens, you can use the SOL as an affirmative defense to convince the court to dismiss the case. A lawsuit filed before the SOL expires will likely lead to a judgment against you that stays in force for 10 years.
      2. How long the delinquency will affect your credit depends, in part, on whether a judgment is obtained. If no judgment is granted, the debt will drop from your report 7½ years from the date of your first delinquency. If there is a judgment, the judgment itself will harm your credit score for as long as it appears, though it causes less harm if you satisfy the judgment, through a payment or post-judgment settlement. If you are looking to qualify for a home loan, you likely will have to pay the collection account or satisfy the judgment.
      3. The debt will remain on your credit report, even if discharged in a BK, for the 7½ years.
      1 Votes

    • 35x35
      Jun, 2012
      Ken
      I might add that the bankruptcy itself may stay on your credit report for up to ten years. Many prime creditors will not extend credit if a bankruptcy is showing on your credit report. Also, many creditors blacklist anybody who has filed bankruptcy and listed them as a creditor. Bankruptcy should be your final option.
      0 Votes

    • 35x35
      Jul, 2012
      Dani
      Dude, If you can now afford a home loan, you should be paying off that previous loan. That company loaned you that money, because you promised to pay it back. It's understandable that you couldn't make the payments for a while, but now that you can, you should start making the payments again, instead of trying to figure out how get even more money loaned to you. People that do this, is part of what's wrong with America these days.
      1 Votes

  • 35x35
    May, 2012
    Karla
    Question: My brother signed a contract for a 1 year gym membership in January 2011. In January 2012 he tried to close it but was being charged with the following month's membership fee and additional late fees. He tried closing the account but was told he first had to pay the fees. The gym piled up 4 month's fees & late fees & will continue to refuse to let him close the account until he pays a ridiculous amount in fees for a gym membership he hasn't used all year. Is this acceptable? For the gym to keep accruing all these monthly membership charges/interests despite him not using the facilities? Shouldn't they just have let him close his account after the 1 yr membership expired? They are unwilling to negotiate a reasonable settlement. Should he wait until being sent to collections? Or just pay of the debt? Please advise
    0 Votes

    • 35x35
      May, 2012
      Bill
      Your brother's first step should be to read the contract he signed. Look for the section called "contract termination" or words to that effect. Your brother needs to understand what he agreed to do to end his gym membership.

      You asked if it is acceptable for the gym to hold him to the terms of the contract if he has not used the facility. I understand your point, but we sign contracts like this all of the time. For example, most cell phone contracts have a monthly minimum fee whether we even turn our phones on. States require us to pay for vehicle insurance even if our car sits in the garage for months on end. We pay the same monthly fee for a bank safe deposit box whether we have nothing in it or the Hope Diamond.

      I realize your brother informed the gym he wanted to end the contract. According to the contract, giving notice may not be enough. He may need to pay an early termination fee. Is paying such a fee reasonable? Maybe, maybe not. Tell your brother to take the contract to a lawyer who has consumer law experience for a review. The contract may be considered unreasonable and unconscionable in his state of residence.
      0 Votes

  • 35x35
    May, 2012
    Stephanie
    Hello ok so I have a question: my mom receive a call in which she did not answer & they left a voicemail asking for me, in the voicemail the person did not mention anything about trying to collect debt they just said that the next day someone would be stopping by to have me sign some papers & if I did not sign them it would show as failure to sign or something like that. (i had no clue who was calling me in till this morning that I called back) When i called I came to find out that they were trying to collect debt about a credit card i haf, but stopped paying in February of 2010, they told me that my debt was baught off by an investor & that if i did not pay iy off or settle it off for monthly payments then they would put a law suit against me & that i would end up paying $2251 & if i made an agreement wit them I had to pay what i previously owed. What should I do? They told me I have till 12pm to call & make an agreement wit them.
    0 Votes

    • 35x35
      May, 2012
      Bill
      First, the 12 pm deadline for returning their call is an artificial deadline that is designed to spur you into action. Second, you indicated you reside in California. See the Bills.com resource California Collection Laws to learn more about your rights and liabilities as a California resident.

      You asked what to do. I suggest you validate the debt. A debt that cannot be validated cannot be collected. Follow the link I just mentioned to learn how to validate a debt.
      0 Votes

    • 35x35
      May, 2012
      Ken
      I might add that although they cannot continue collection activity, there is a chance they can sue. Yes, initiation of a lawsuit is a collection activity and, in theory, they may not do that until the debt is validated, not all jurisdictions have held that to be the case. In addition, if they file suit prior to a validation request, it puts you at a disadvantage. From what you mention, it seems like the debt is not time barred by the statute of limitations. Depending on how motivated the creditor is, you may find they obtain a judgment against you.
      0 Votes

  • 35x35
    May, 2012
    Brad
    Thank you in advance for your reply. I live in California. I have unsecured credit card debt from 2006. All accounts went past due in March of 2006. I have never attempted to repay these debts. Scanning court records, in my county, I discovered that I had a lawsuit filed against me by one of the creditors. Judging by the case notes, I see that the case was dismissed without prejudice because the creditor failed to serve and give me proper notice. During the last six years, I lived out of state for six months, in 2008. Today, I received a collection style call at home. I have two questions: 1. Did the tolling stop when I reestablished residency in California after my six month absence from the state? 2. Did the filing of the lawsuit, by the creditor, have an affect on the SOL clock?
    0 Votes

    • 35x35
      May, 2012
      Bill
      1. California Code of Civil Procedure § 351 sets the tolling rule for the circumstances you described:
        If, when the cause of action accrues against a person, he is out of the State, the action may be commenced within the term herein limited, after his return to the State, and if, after the cause of action accrues, he departs from the State, the time of his absence is not part of the time limited for the commencement of the action.

        To oversimplify 351 a bit for the point of illustration, the clock stops when you leave California, and it restarts when you return.

      2. Filing a lawsuit can, in narrow circumstances, start a different one-year statute of limitations clock. See § 355 and § 356 to see if either of these rules fit your circumstances. Based on what you described, I do not believe they do, but review the statutes to be sure.

      When a reader faces litigation, I always advise consulting with a lawyer. This is because readers do not always share all relevant facts in their comments, and my understanding of the law in all US jurisdictions is far from complete.

      If the statute of limitations has run on the debt here, and a collection agent pesters you to pay the debt, send it a cease communications letter.

      0 Votes

    • 35x35
      May, 2012
      dan
      I am a California debtor, having borrowed on a small business line from an eastern bank doing business in California. Thee line was not renewed, and all principal and accrued interest were state as due in January of 1988. No payment was made. I assume, given no other factors, that the 4 year statute would have run in January 2012. However, in the interim, in June of 2011, another written demand was made on the original debt, stating the new updated figure taking into account accrued interest. My questin is whether or not another 4 year statute began to run as of the date of the new demand, on account stated or whatever that is called. Thank you.
      0 Votes

    • 35x35
      May, 2012
      Bill
      What is the date of breach on the contract? That starts the statute of limitations clock, generally speaking. Please see the section entitled "Clock Starting & Stopping" above for an analysis of California statute and case law on this matter.
      0 Votes

  • 35x35
    May, 2012
    Charlie
    Can an organization invoice us NOW for software support from 2008 and 2009. We have not used this software since early 2010 . I did not know if there were statute of Limitations for something like this?
    0 Votes

    • 35x35
      May, 2012
      Bill
      A statute of limitation for debt is an affirmative defense a consumer or other defendant can raise in court. Except in Wisconsin, a statute of limitations does not bar a creditor from collecting a debt.

      To your point, I am not aware of any rules in California that regulate how much time can pass before a creditor may start collections.
      0 Votes

  • 35x35
    May, 2012
    Steve
    Im curious about the SOL in california for a voluntary reposession..here is the credit report info:
    Account Owner: Maker
    Type of Account : Installment
    Credit Limit:
    Term Duration:
    Terms Frequency: Monthly (due every month)
    Date Opened: 09/2003
    Balance: $12,754
    Date Reported: 04/2012
    Amount Past Due:
    Date of Last Payment: 06/2009 (This is when they sold the car)
    Actual Payment Amount: $7,076
    Scheduled Payment Amount: $490
    Date of Last Activity: N/A
    Date Major Delinquency First Reported: 11/2009
    Months Reviewed: 71
    Creditor Classification:
    Activity Designator: N/A
    Charge Off Amount: $12,754
    Deferred Payment Start Date:
    Balloon Payment Amount:
    Balloon Payment Date:
    Date Closed:
    Type of Loan: Auto
    Date of First Delinquency: 04/2008
    Comments: Charged off account, Fixed rate

    The timeline shows that I was 30 days late starting in April of 2008 and increases to 180 days late in October. It stays at 180 days late until charge off in November of 2009. Im not sure if I made payments between after April of 2008 and the voluntary repo. Does the clock start ticking from the date of first delinquency or the last payment I ever made on it?
    0 Votes

    • 35x35
      May, 2012
      Bill
      Let me answer a question you did not ask, first. For the purposes of learning when the 7½-year clock starts for this derogatory account appearing on your credit report, the date of first delinquency is what to look for. Here, the date of first delinquency is April 2008. This means this account will fall off your credit report on or about October 2015. Now the harder question.

      Editor's note: Updated answer follows. In California, the statute of limitations clock may or may not start at the same time as the date of first delinquency, depending on the circumstances, but usually it is a different date. The statute of limitations clock starts with the date of breach. Or, if the borrower never made a payment, the clock starts when the first payment was due. Here, you need to dig into your bank or credit union records to find your last payment date. Based on the facts you mentioned, this was somewhere between April 2008 and June of 2009.
      0 Votes

    • 35x35
      May, 2012
      Ken
      It is unlikely the statute of limitations starts with the date of last payment. In California, as in other states, the SOL starts after a cause of action shall have accrued. As such, it is unlikely to be the date of last payment. Without actually examining the terms of your contract (acceleration clauses can be a factor), the most likely trigger of the SOL in your case is the day after the due date of your final missed payment. It may also be the day after your first missed payment was due should you never have subsequently brought the account current.
      0 Votes

  • 35x35
    Apr, 2012
    Leticia
    My attorney has informed me that my husband and I do not meet the burden to file Chapter 7 and would need to file Chapter 13. I just checked out credit reports and all our creditors have updated our credit reports as "account charge off". Does this mean we are "off the hook" unless they sell it to a collection agency? Thank you.
    0 Votes

    • 35x35
      Apr, 2012
      Bill
      Charge off has no meaning to consumers, as a legal matter. Charge-off is a creditor moving the customer's account from the accounts receivable ledger to the bad debt line on the general ledger. As a practical matter, it is usually easier for a customer to negotiate a settlement for less than the full balance due on an account in a charged-off status, than it is to negotiate a current account.

      Just to be clear: Charge-off is not the same as canceling or forgiving a debt.
      0 Votes

    • 35x35
      Apr, 2012
      Leticia
      Thank you. We had advised our creditors that we were filing Chapter 7 so they have not contacted us. With this information, would it be best to work with the larger debt companies first to try to work something out? Should we wait for them to contact us or should we initiate the call. Appreciate your information.
      0 Votes

    • 35x35
      Apr, 2012
      Ken
      I might point out that a creditor typically charges off an account approximately 180 days after default and that can trigger the CRTP. Negative entries on a credit report can remain, in most instances, 7 years from date of charge off.
      0 Votes

    • 35x35
      Apr, 2012
      Leticia
      I am sorry, but what is CRTP?
      0 Votes

    • 35x35
      Apr, 2012
      Bill
      "CRTP" stands for "Credit Report Time Period," in this case, I believe.
      0 Votes

    • 35x35
      May, 2012
      Bill
      Leticia, are you indeed planning to file for Chapter 7 bankruptcy? If so, that will clear out your debts, if you qualify (though you may need to liquidate assets, depending on the bankruptcy exemptions in your state).

      If you told your creditors you plan to file for BK, when you did not really plan to do so, in order to slow down their collections, then you need to work on an alternate strategy. Whether you work on the largest debts or not depends on a variety of factors, including your ability to pay for any settlement you may reach and how aggressive your different creditors are towards you.

      I suggest that you speak with a bankruptcy attorney, to see if you qualify for Chapter 7. You're not required to file, just because you qualify. If you do qualify, however, it increases your leverage with your creditors to negotiate favorable settlements. The attorney will recommend a course of action.
      0 Votes

    • 35x35
      May, 2012
      Leticia
      Thanks for your response. We have spoken to an attorney and unfortunately do not qualify for Chapter 7, but do for Chapter 13 with all creditors paid back within 5 years. However, the additional costs of the attorney fees ($1,100 versus $4,000) and the trustee fees ($4,000+) makes us hesitant to file and more inclined to work with our creditors to settle. Is there language I should use when contacting them to help with the process and updating our credit report with a more positive update versus "charge off"? We truly appreciate your help.
      0 Votes

    • 35x35
      May, 2012
      Bill
      If an account has gone into charge-off status, nothing short of negotiating a pay for delete is going to remove accurately reported information.

      Please read the Bills.com article How to Settle Credit Card Debt, which discusses both how an individual should handle negotiations and what to look for, when trying to find a reputable debt settlement firm.
      1 Votes

    • 35x35
      May, 2012
      Leticia
      THANK YOU! Your site is wonderful.
      0 Votes

    • 35x35
      May, 2012
      Ken
      Actually some creditors will remove negative information they have reported to your credit report as a gesture of good will. When discussing payment terms with your creditors mention this aspect. Not all will agree, but you'd be surprised at how many will -- especially collection agencies.
      0 Votes

  • 35x35
    Apr, 2012
    yolanda
    I have an old credit card that was last paid on 7/2005 on 5/2008 they filed a judgment and today on 4/26 I receive a garnishment. Does the statue of limitations apply? Why would they not have sent me notices prior to this garnishment notice and what can I do now? They want nothing less then full payment.
    0 Votes

    • 35x35
      Apr, 2012
      Bill
      Once a judgment is obtained, the SOL for collecting on the debt no longer applies. What does apply is the state law for how long a judgment remains enforceable, which varies from state to state. Also, some states allow judgments to be renewed.

      There is not a lot you can do, at this point, if the judgment-creditor is satisfied with what it can take from you via a garnishment. Do be careful, however, regarding your bank account, as you could have a bank account levied at the same time that you're having your wages garnished.
      0 Votes

  • 35x35
    Apr, 2012
    therese
    Last July 2011, I was charged a mowing fee by the HOA and property management company for my land in San Luis Obispo. This was done without my knowledge and without my permission. Can they legally take me to court for this fee? I feel like it's more of a trespassing issue from my point of view. Thank you!
    0 Votes

    • 35x35
      Apr, 2012
      Bill
      Yes, the HOA can sue you. What the HOA has the authority to do is based on the terms of your HOA agreement. If you feel that the HOA exceeded its authority, meet with a lawyer to get a legal opinion based on a review of the actual agreement.
      0 Votes

    • 35x35
      Apr, 2012
      Therese
      Thank you for responding so quickly. There is nothing in the CC&Rs that states that the HOA can do this. Is there a statute of limitation on this type of thing? They did the weed abatement in July 2011 and I have yet to pay this fee...it has been 8 months.
      0 Votes

    • 35x35
      Apr, 2012
      Bill
      Statutes of limitations relate to contracts, such as credit card debt and sales, and torts.

      If the HOA does not have a legal right set forth in your CC&Rs or other covenants running with the land to enter your property to cut grass or remove weeds, then you may not have any liability for its costs of cutting the grass or removing the weeds. Let me illustrate my point with a brief hypothetical situation: Let's say you were out cutting your grass one morning, and in a burst of entrepreneurial spirit you cut the front lawns of the neighbors on either side of yours. You knock on each door and say, "Your lawn looked a bit shaggy, so I cut it! Please pay me $20." Your neighbors refuse to pay and you take them to court. No judge in the US would allow you to profit for completing an unauthorized service in these circumstances.

      If the HOA does not have a legal right set forth in your CC&Rs or other covenants running with the land to enter your property to cut grass or remove weeds, then it may have committed trespass when it entered your land without your permission. If your HOA was acting like the entrepreneurial homeowner, then not only do you not have to pay it for the services performed, you may have a cause of action for trespass. On the other hand, let us say you live in an area prone to fires, and your property was so overgrown it posed a threat to other properties. Then for the safety of the public, the HOA may argue that even though it did not have your permission to enter the land, a public necessity exception applies. Because of this necessity, you have liability to pay for the maintenance to make your property fire-safe.

      There is more I do not know about your situation than I know. That is why I suggested in my earlier response for you to consult with a lawyer to learn your rights and liabilities in your particular circumstances.
      0 Votes

    • 35x35
      Apr, 2012
      Ken
      Actually, it would be exceedingly rare if your HOA did not have the legal authority to do what they did. You might want to go back and read the CC&R's carefully and look for items such as external appearances / aesthetics of property, various items which tend to reduce resale values of properties in the neighborhood, etc ... . They do not have to specifically cite "lawn care" in the HOA. Your best course of action is seeking local legal counsel who can actually go over your agreement with the HOA.
      0 Votes

  • 35x35
    Apr, 2012
    Mark
    I filled for BK in 2005 and 2009 both were dismissed. There was a student loan from with a private company. Has the SOL run out from the Original time I filled BK?
    0 Votes

    • 35x35
      Apr, 2012
      Bill
      I assume when you use the word "dismissed" you mean the bankruptcy court threw both the 2005 and 2009 bankruptcy filings out of court, and neither resulted in successful discharges of your debt. If so, then these unsuccessful filings have nothing to do with any statute of limitations for debt. You mentioned a private student loan. When was the last payment on this loan? You indicated on the form where you entered your comment that you reside in California. The California statute of limitations probably applies to this debt. The statute of limitations for a written contract in California is mentioned in the original article above.
      0 Votes

    • 35x35
      Apr, 2012
      Ken
      We need to be careful when it comes to student loans. Not only are they now no longer dischargeable in bankruptcy, bu there are also additional collections devices which are available to those creditors which are not available to creditors in non-student loan debts and that the statute of limitations may or may not protect you from.

      It used to be that "private" student loans were treated as any other common unsecured debt, but that is no longer the case. Even the loan was obtained from a private lender, Congress has amended the law to include them in the same category as student loans obtained directly from government lenders. Amongst other things, and in addition to additional collections methods as previously mentioned, this means that they may report on your credit report for far longer than 7 years from date of first delinquency. Far longer.
      0 Votes

    • 35x35
      Apr, 2012
      Mark
      The last payment was 2006 when I filled for BK. Does the SOL count during BK or it starts again from the dismiss. And yes, you are correct, thrown out by the courts. Am, I still responsible, if so I will continue to pay but if not then I will let the company know about SOL.
      0 Votes

    • 35x35
      Apr, 2012
      Bill
      The California statute of limitations for a debt is tolled while an injunction or statutory prohibition to collect is in place. This applies because a bankruptcy stay stops creditors from taking an action while the stay is in place. In other words, during a stay, the statute of limitations clock pauses at the moment the stay becomes effective, and then restarts when a stay is lifted. See California Code Of Civil Procedure Section 356 for details.
      0 Votes

  • 35x35
    Apr, 2012
    Charles
    Hello. I have credit card debt that will hit the SOL in dec of this year. (I live in calif) I just received court papers that a local collection is going to court to collect. If they get a judgement againt me and then dec arrives, can they still collect? Should I contact them in Dec 2012 and mention that the debt is past the SOL? Thx for your help.
    0 Votes

    • 35x35
      Apr, 2012
      Bill
      The statute of limitations refers to the date of filing an action, not collecting on a judgment. Let us say for the sake of argument the statute of limitations expires on December 10. The creditor has until the clerk of court's office closes on December 9 to file the action with the court. Under California civil procedure law, the plaintiff has a certain number of days to serve the summons on the defendant after the filing date. If, for the sake of argument, the plaintiff files the action on December 11, the clerk of courts is not going to say, "Sorry, your time ran out!" The clerk knows nothing about your case or its statute of limitations date. Instead, when you go before the judge, you will present your evidence for the affirmative defense of statute of limitations. The judge will listen to both sides, and then rule on your motion. If your evidence is believable, then your case will be dismissed. If not, then the case will proceed. Consult with a California lawyer who has civil litigation experience for a more detailed answer.
      0 Votes

    • 35x35
      Apr, 2012
      Charles
      Thank you. I guess I asked the question wrong. The collection agency gets a judgment against me in June 2012. But the SOL for the original debt takes effect on dec 30 2012. Can they continue to try to collect or can I notify them that the debt is now (Dec 2012) past the sol and ask then to stop trying to collect? Does the sol taking effect on Dec 2012 have any effect on past court judgments against me? (Could I go back to court and ask the judge to stop the collection agency from any further collection action because of the now sol?)
      0 Votes

    • 35x35
      Apr, 2012
      Bill
      A statute of limitations for debt is a deadline for filing an action. By "filing an action" I mean filing a lawsuit. It has nothing to do with how long a judgment-creditor may attempt to collect the debt. Once a plaintiff files an action before the statute of limitations expiration date, that date has no further meaning.

      The judgment itself, on the other hand, has its own lifetime. In California the life of a judgment is 10 years from the date of the order. Let us say for the sake of argument that your judgment-creditor's judgment was signed by the judge on June 15, 2011. The life of that judgment will end on June 15, 2021, unless the judgment-creditor renews the judgment, which it must do before June 15, 2021. This means the judgment-creditor has until June 15, 2021 to collect on the judgment.

      As I mentioned, I made-up the June 15 date, and you will need to look at the judgment to learn its effective date.
      0 Votes

  • 35x35
    Apr, 2012
    Juvy
    My mom recently received a collection letter from Michaels and Associates regarding an account opened in April 2000. It had 3 payment options, but my mom couldnt remember if she had a sprint account in 2000. So I called the number to ask to verify, and they told me the account was open for 4 years starting April 2000 and I asked them to verify what address the account was open with but they couldnt tell me. The collection agent was rushing to get our payment information, and when I requested more information, she pressured me and said that it will take up to 4 months to get the details, and by that time, the "discounted" price will be gone by then. I was about 12 in 2000 and I remember having Cingular as my first cell phone.. so this could not be accurate. What should I do?
    0 Votes

    • 35x35
      Apr, 2012
      Bill
      Your Mom should immediately validate the debt via a letter sent registered mail. Were I in your Mom's place, I would not pay a penny to this collector. The debt should be well past the statute of limitations, if the last payment on the account was in 2004. It may not be her account at all, which is why debt validation is the first step she should take. If it is her debt, making a payment on it could bring a dead debt back to life. Instead, if the creditor sues, she can go to court and use the SOL as an affirmative defense so she doesn't have to pay.
      0 Votes

  • 35x35
    Mar, 2012
    Cassie
    Hi, I just ran my credit report and found Equifax report has two collection items(from the same collector, 2 accounts medical bills). The other two credit bureaus don't find anything. Date reported is 07/2006, last activity is 01/2006, date opened is 06/2006. We are in a process of qualifying loan for buying house, other than the collection from EF report, my other Transunion and Experian was very good over 750 FICO score. Would my debt be disappear in 2013? I was worry about my qualification of loan and contacted the collection agency, does it make debt active now? Should I pay it off right now or wait after I got my house(I was instructed by my Loan consultant to not pay it before getting the house as it will make the collection current).
    0 Votes

    • 35x35
      Mar, 2012
      Bill
      I would act according to the advice offered by my loan officer.

      If you wish to pay the delinquent account, however, do so only if you can negotiate a pay for delete agreement.
      0 Votes

  • 35x35
    Mar, 2012
    jen
    I opened a credit card when I was under age , 17 years old, being naive i let it go to collections. This was December of 2005 that i opened it and it went into collections in early mid 2006. Now, march of 2012, i have an agency hassling me about this card. Is the SOL up? Am i liable for the account since i was under age when i opened it? It's been over 5 years since I was hassled for this account.
    0 Votes

    • 35x35
      Mar, 2012
      Bill
      Your signing the credit card application while a minor is an interesting question. You may have agreed to new terms with the credit card issuer after you reached age 18 in one of the issuer's statement sent to you that read something like, "Here are the new terms and conditions of your credit card agreement; call this number if you do not agree." Credit card issuers send these periodically when they wish to change the terms and conditions of their contracts. However, that's speculation, and an issue a lawyer you hire would need to research.

      The statute of limitations is an affirmative defense a defendant can use at trial. In most states, the passing of the statute of limitations for a credit card debt does not mean the original creditor or a collection agent that was assigned the account is barred from collecting the debt. Read the original article above or the Bills.com article Statute of Limitations for a longer explanation.
      0 Votes

    • 35x35
      Mar, 2012
      Ken
      It's likely that you cannot use age as a defense for several possible reasons. First of all, if you misrepresented your age on the initial application that would likely mean you committed fraud. While the SOL would have run on that long ago, in a civil case fraud would likely negate your claim of a non-binding contract. Secondly would be the issue of having agreed to any new contract just by using the card. Finally, many card issuers also hold authorized users liable for what they charged on the account should the initial applicant default. American Express is one such company that does this as a matter of routine. So, while perhaps not contractually liable for the account, as a user on that account you may be held liable for all charges you made regardless of age -- or at least those charges you made after attaining 18 years of age. Since the account seems to have gone into default 6 years ago or so, it's highly likely that the statute of limitations has expired. If that is the case, whatever age you were when you opened the account is irrelevant. I would, in fact, not even mention that fact to the issuer.
      0 Votes

  • 35x35
    Mar, 2012
    Skip
    You said, "In most states, the SOL begins running from the date of the breach." Just wondering if California is one of those states. Here's California Code of Civil Procedure § 337:
    337. Within four years: An action to recover a balance due upon a mutual, open and current account, the items of which are in writing; provided, however, that where an account stated is based upon an account of one item, the time shall begin to run from the date of said item, and where an account stated is based upon an account of more than one item, thetime shall begin to run from the date of the last item.

    Does that "run from the date of the last item" mean date of last payment or charge?

    0 Votes

    • 35x35
      Mar, 2012
      Bill
      Editor's note: Updated answer follows. In California, the statute of limitations clock on a debt starts on the date of breach. See the discussion in the original answer above for a longer explanation.
      0 Votes

    • 35x35
      Mar, 2012
      Skip
      Sorry--I'm weak on terminology. Is the date the debt "became due" the date of first default, or the date the entire amount was demanded in full?
      0 Votes

    • 35x35
      Mar, 2012
      Bill
      The due date for a debt payment is set by contract or what is well-established and known by the players in that line of business. I think what you mean by "the date the entire amount was demanded in full" is an acceleration clause that applies when the debtor fails to make the payments as promised. A court would probably view an acceleration clause date as irrelevant for the purposes of determining the start date on a statute of limitations.
      0 Votes

    • 35x35
      Apr, 2012
      Ken
      It is simply untrue that an acceleration clause is irrelevant in determining when the statute of limitations commences. While an acceleration is generally of little significance in determining the credit reporting time period, it most certainly can establish date of default on an obligation and, as a result, commencement of the SOL. The statute of limitations commences when a creditor first has a cause of action. Most common acceleration clauses establish exactly when default occurs and, as a result, when legal action may be commenced. In residential real estate it would be rare for a mortgage holder to be able to initiate suit simply because you are 30, 60 or, usually, even 90 days in arrears.
      0 Votes

  • 35x35
    Mar, 2012
    Eric
    I closed a cell phone account back in 2004 with At&t and paid the early cancellation fees and any outstanding debt I had with them (At&t) back in 2004 using my mothers credit card, even though the acct had gone to collections by that time I paid At&t. In 2005 or 2006 (I don't exactly remember) I received a letter from a collection agency and when I called they quickly saw their error and dismissed it. I never had a problem with it going on my credit report and recent checks do not show anything other than a new collection agency checking my credit. The collection agency I speak of has recently sent me letters saying I still owe on the debt. My mother is no longer with us and I don't remember what credit card she paid the debt on so it is hard to check back that far since I do not have documents from that long ago. I know that the SOL are up and since it never showed up on my credit and is not on there now it doesn't seem to have ever been there. My question is should I just ignore it, is this company just fishing? What can I do to get them to never try this again?
    0 Votes

    • 35x35
      Mar, 2012
      Bill
      Validate the debt as a first step. Don't pay a penny, as you can restart the SOL.

      I don't believe you can stop them from trying to collect on the debt, short of being able to prove that you paid it. You need to play a strong defense, if collection attempts continue.
      0 Votes

    • 35x35
      Mar, 2012
      Eric
      So if it never showed up and I never received a summons or anything more than an annoying letter, is there anything they can do? It has been at least 7.5 years since I paid the debt, so how do I prove that I payed it since documentation from that far back has not been saved? It never went on my credit report either. I will send them the validation letter you mentioned. What is my next step after that?
      0 Votes

    • 35x35
      Mar, 2012
      Bill
      Wait to see if the collection agent validates the debt. If it does, then you either negotiate a settlement or wait to see if the collection agent takes the case to court.
      0 Votes

    • 35x35
      Apr, 2012
      Eric
      I sent the letter you suggested and they just resent the original contract I signed in 2003. They did not send any of the other info that was requested on the letter. Also I have found out that the company is no longer in business that they are collecting for, which was stated to me over the phone that they were collecting for directly, not as debt sold to them. What should I do now, considering that it does not seem that they validated the debt only that I signed a contract. In the contract it stated that the company could, the key word was may in the the contract, have funds withheld from AT&T if I cancelled early but I know I paid the early cancellation fees and have no proof that they had to pay anything. The guy even tried to lie to me and tell me that the SOL was not up, which by all the research I have done is obviously a lie.
      0 Votes

    • 35x35
      Apr, 2012
      Bill
      A copy of a contract is not an acceptable debt validation according to the federal circuit courts I have found that weighed in on debt validation. See the Bill.com article Debt Validation to learn more.

      My advice? Send the creditor a notice of insufficient validation.
      0 Votes

    • 35x35
      Apr, 2012
      Ken
      If the statute of limitations has run, you can safely send them a cease & desist. This prohibits them, basically, from ever being able to contact you again over this debt. Further, since 7 years have passed since the account went into default, the credit reporting time period has run and they cannot report this debt to the credit bureaus.
      0 Votes

  • 35x35
    Mar, 2012
    Frederick
    I got a motorcycle repossession in 2006. I began repaying an agency this year. I now got contacted by a second agency saying that they demand repayment. Can I raise the SOL defense with the second agency?
    0 Votes

    • 35x35
      Mar, 2012
      Bill
      I need more information to answer your question. Are you still paying Collection Agency No. 1? If not, did you pay off the debt completely?

      Let me assume for the sake of argument that you made one or more payments to Collection Agency No. 1, and then stopped making payments before repaying the balance due. Let us say that Collection Agency No. 1 sold your collection account to Collection Agency No. 2. The second collection agency would argue to a court, I think successfully, that your making a payment to Collection Agency No. 1 reset your state's statute of limitations clock for that debt at zero.
      0 Votes

    • 35x35
      Mar, 2012
      Frederick
      Hey I just noticed on my question, that my girlfriend made a mistake. only part of it was right. I purchased a Motorcycle back in November 2006. But it got repossessed late of 2006 early 2007 & I was not even home at the time. It is now 2012, so would the statue of limitations apply to me? I was barely 18 at the time of the contract!!! I was contacted a few weeks ago, about the debt, saying that I owe money. A few months after the bike got repossessed, it ended up getting sold at an auction. The original finance company did not even try to contact me. So now the Law Offices Of Curtis O Barns are the ones trying to collect the debt. I talked to the employees, they were unprofessional & rude. My last payment on the bike was when I made a down payment in 2006. I mentioned the statue of limitations and the person I was speaking to said "Well to bad you still have to pay & if you can't have your parents pay?" What if your advice?
      0 Votes

    • 35x35
      Mar, 2012
      Bill
      As stated above, the California statute of limitations does not apply to a collection agent telephoning you or sending letters in an attempt to collect a debt. Under California law, the passing of the statute of limitations for a breach of contract relating to a consumer debt does not mean a creditor cannot file a lawsuit against you, or that collection agents are barred from collecting the debt. The statute of limitations is a defense used in a trial. If the law office files an action — a lawsuit — against you, then you can use this defense.

      My advice? Send the law firm / collector a cease communications notice.
      0 Votes

    • 35x35
      Apr, 2012
      ben
      Hi! I have a question to ask about my at&t cell phone bill. Back in 2008 I got a at&t cell phone contract under my name which I let my girl friend use. She used my cell phone for a few months and racked up my phone bill to eight houndred dollars. I stoped paying at&t as of april 2008, just recently I got a call from a collection firm saying I need to pay them two thousand dollars which I don't have. They even sent a letter with my bill thats due. I told them my story and so on. I was wondering if SOL would play a role if they take me to court. Do I have to pay them since it's been four years past
      0 Votes

    • 35x35
      May, 2012
      Bill
      Editor's note: Updated answer follows. I assume this is a California matter. SOL issues are tricky. If, however, it has been more than four years since you started missing your payments and became in breach of contract, you can make the SOL argument as a defense in court.
      0 Votes

  • 35x35
    Mar, 2012
    Karen
    Hi, I received a notice from a debt collector last week from an old cell phone bill. I called the company who apparently has purchased the debt from Verizon asking for more information on this account. They said the bill was from a cell phone account opened in 2000 with the last payment being made in 2002, 10 years ago. I told her I was just calling for information on the account and needed to consult with my husband. Wouldn't the SOL apply in this case? They have never called me on it and now that they have my phone number from me calling I am afraid they will start now. The bill is a settlement to reduce the amount owed by 60 percent. Thanks
    0 Votes

    • 35x35
      Mar, 2012
      Bill
      California's statute of limitations on debt does not apply in the manner you imply. The passing of the California statute of limitations does not mean a creditor may not sue you or is stopped from collecting the debt. The statute of limitations on debt is an affirmative defense a defendant may raise in a hearing. If the court accepts the affirmative defense, it will dismiss the case.
      0 Votes

  • 35x35
    Mar, 2012
    Sonya
    I had to file for Chapter 13 in 2004. I have the proof in my Final Report and Account that this debt was discharged. Recently, my husband began getting calls from a debt collector supposedly representing one of the creditors. We've never answered their calls, because we thought it was regarding one of our adult children's finances. I don't want to communicate with them, which would reset the SOL. What's the best way handle this? Do we just keep ignoring the calls?
    0 Votes

    • 35x35
      Mar, 2012
      Bill
      Picking up the telephone to speak to someone who claims you owe a debt does not reset a statute of limitations. Anyone making that claim misstates the law.

      Put a notepad and pen next to your telephone. The next time the creditor who claims you owe a debt that was discharged in bankruptcy calls, gather the maximum amount of information you can about the caller. Learn the caller's:
      • Full name
      • Street address
      • Employer's name
      • Telephone number
      • Any details about the alleged debt, such as the account number, amount, and so on.

      Do not make any promise to pay the debt. If the caller asks why you quiz them about their contact information, explain you need time to research the debt and want accurate contact information to reach the caller.

      Consult with a consumer lawyer or your bankruptcy lawyer. You almost certainly have a cause of action, a legal reason to file a lawsuit, against the collection for violating federal bankruptcy law. Your lawyer may take the case on a contingency basis, which will result in no out-of-pocket costs to you.

      0 Votes

  • 35x35
    Feb, 2012
    Mariela
    Hi, I'm hoping you can help me with this. I recently received a letter from a company demanding payment for an MRI I received in 2007. They sent me a copy of my bill together with a copy of a court judgement approving the sale of accounts receivable from the MRI company to this company back in March of 2009. I have NEVER received any bills from any company regarding this MRI. I just assumed my insurance covered it. Now, over 5 years later, they say that I either pay $1800 or they'll send me to collections. I told the person I spoke with that the California SOL had expired, but she said that "I consulted with attorneys, and because the judge granted us the right to collect on this account, you either have to pay or your account will go to collection." If they send my account to collection and they ruin my credit score, can I sue them for damages?
    0 Votes

    • 35x35
      Feb, 2012
      Bill
      The judgment approving the sale of accounts receivable from the MRI company to the collection agent (if authentic and accurate) is relevant only in that it may establish the collection agent's right to collect the debt. I do not know if a court would consider it adequate evidence to validate the debt. Therefore, your first course of action is to validate the debt.

      The collection agent's statement that you need to pay or see the debt go to collections is laughable because the debt already is in the debt collections process, and is subject to the FDCPA.

      Just because the statute of limitations has passed on the debt does not mean the debt may not be collected, unless the consumer resides in Wisconsin. The passing of California's statute of limitations also does not mean the debt may not be reported to the credit reporting agencies.
      1 Votes

    • 35x35
      Mar, 2012
      Mariela
      "Just because the statute of limitations has passed on the debt does not mean the debt may not be collected, unless the consumer resides in Wisconsin. The passing of California's statute of limitations also does not mean the debt may not be reported to the credit reporting agencies."
      Thank you for your reply. I don't understand this last paragraph... so if the debt can still be collected and reported to a credit reporting agency, what's the SOL for? So, anyone can claim I owe them money and report me to a credit reporting agency? And I can't do anything about it? That sounds like extortion to me! Can you please clarify?
      0 Votes

    • 35x35
      Mar, 2012
      Bill
      According to credit reporting laws, a derogatory entry on a credit report can appear for 7½ years. The laws for credit reports have no relationship to a state's statute of limitations. For instance a state can have a statute of limitations for credit card debt of four years. The debt will still show for 7½. If you were sued after the SOL expires, you can use the SOL as a defense to not pay the debt.

      Institutions cannot report false information to the credit bureaus. If you had a bogus debt appear on your report you can validate the debt and dispute the inaccurate information. You can also file a lawsuit, if a debt collector is violating the laws governing debt collection.
      0 Votes

  • 35x35
    Nov, 2011
    Rob
    what about debt incurred in another country, do I have recourse to fight it. I recently was contacted by a collections agency about 2 traffic tickets while in Italy in 2008. In my opnion the tickets were a scam and never paid them.
    0 Votes

    • 35x35
      Nov, 2011
      Bill
      Do what a foreign tourist visiting the US would do to fight a sketchy US traffic ticket — hire a local lawyer who knows the local laws and courts to fight the ticket.
      0 Votes

  • 35x35
    Oct, 2011
    jen
    A judge ruled in my favor back in 2003 to collect on a tenants delinquent rent. What would be the best way to go about collecting the money owed to me?
    0 Votes

    • 35x35
      Nov, 2011
      Bill
      It can be very difficult to collect on a judgment. If the size of the judgment (plus all the interest that is legally allowed to be added post-judgment) is large, I suggest that you contact a law firm that specializes in collecting on debts. Many such firms will work on a contingency fee basis, where you don't pay a fee unless the debt is recovered.

      Judgments in CA last 10 years, if it is getting close to the 10-year period and you have not yet collected on the debt, then look into renewing the judgment.
      0 Votes

  • 35x35
    Oct, 2011
    Aaron
    I was wondering what exactly the State of Limiation meant towards a debt. I understand that collection agencies can continue to collect/sue for debt past the SOL. However, will this continue to hurt my credit score after the item is removed from my credit report. In other words, is it just like a "ghost" debt account? Will anyone be able to see it after the 7 years?
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      A state's statute of limitations and what appears on your credit score have no relationship to each other. Credit report rules are federal and governed by the Fair Credit Reporting Act. Your state's statute of limitations laws give a defendant an affirmative defense should the creditor file a lawsuit against the defendant.

      Once a derogatory account is removed from a credit score, it is no longer reported to anyone.
      3 Votes

  • 35x35
    Oct, 2011
    Laurie
    My ex-husband and I purchased a "time share" but agreed in divorce documents that the property would be his and he would be responsible for all the payments. I was to file a quit claim deed. Due to various circumstances, I never filed the quit claim deed. Apparently he stopped making the equivalent of HOA dues (annual dues) and now the organization is looking to collect back HOA dues for 19 years! Apparently he did make all the "mortgage" payments. Because they can't get ahold of my ex-husband, they are now coming after me. Not sure if the fact our divorce papers stating that property was his responsibility is enough to protect me, but hasn't the statue of limitations passed on this? I know in the condo I own if HOA dues are past more than a couple of months, collections are initiated. The Board would never let years and years pass without doing anything and then expect to collect past due HOA dues.
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      I confess I have no idea how a court would look at a situation like the one you described. Consult with a lawyer in your state who has real property experience, and preferably one who has litigated HOA cases.
      0 Votes

  • 35x35
    Oct, 2011
    Sean
    In 2004/2005, my then girlfriend - now my wife - and I lived in a rental property in San Jose, CA. We were asked to vacate the premises because the owner wished to sell the house. There was a question with respect to some rent still owed and we made some attempts to pay the owner back up until July 2006. We had come upon difficult financial times and had moved several times ourselves. We lost contact with the owner, even though we had kept the same email address. Recently, in 2011, we received an email from someone claiming to be acting on behalf of the owner, demanding the full amount of back rent owed on that property. It is my understanding after reading the Civil Code associated with subjects such as this that the owner had four years from the date of last payment to file paperwork to collect the debt owed. It is now October of 2011, five years after any last payment would have been received by him. Has the statute of limitations run out on his ability to collect this debt? it should be noted that there is no legally binding/signed paperwork of any repayment agreement between the parties.
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      In most states, including California, a creditor may contact a consumer in an attempt to collect a debt even though the statute of limitations for that type of debt has run its course. In most states, including California, a creditor can file an action — a lawsuit — against the consumer even though the statute of limitation has run its course. In this situation, a defendant must raise the statute of limitations affirmative defense during the trial. The court will not raise this defense for the defendant. If the defendant raises the statute of limitations defense, and the court believes the facts, then the court will dismiss the case.

      Some personal finance commentators concatenate this explanation into the sentence, "If the statute of limitations has passed, the creditor can't do anything," which is incorrect. I have heard others say, "Once the statute of limitations has passed, the creditor cannot sue a consumer," which again is not accurate in most states.

      If the representative annoys you, send him or her a Cease Communication Notice.
      0 Votes

  • 35x35
    Oct, 2011
    Melissa
    From time to time I sell items on ebay and get paid via paypal which is typical, however a few days ago I noticed paypay had put a hold on my account. Come to find out they are saying that my ssn was linked to another account with paypal and since 2003 I owe them $6000. There has been no payments to this account since 2003 and I want to know if they can hold me liable for this money. They are holding the available funds in my paypal accont which I count on to pay some bills.
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      Consult with a lawyer immediately to learn if Paypal's actions violate your state's banking laws. Regarding your statute of limitations question, I doubt that will come into play in this situation unless you reside in Wisconsin.
      0 Votes

  • 35x35
    Oct, 2011
    larry
    hi, there are several things with this and am looking for help. i had an account with a supply house for electrical products. which i had closed in 2006 when i sold the business and moved to another state. as of a couple of months ago a collection company /lawyer office is now harrasing me to pay what they say we owed on this account in 2006.we have asked for a copy of our application which i had filled out with no signers allowed except myself, the few invoices they have sent have someones signiture on them but not ours.we also asked for copies of these alleged invoices which they provided only a few hundred worth but claim there is over 1500.00 worth. we have made no paqyment to them since early 2006.all the letters are a form letter style and we have tried to talk to them but they dont want to talk.just saying you owe..... any sugestions? is there ant statue of limitions which could apply if i need to go that way? thanks
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      Statutes of limitations may apply, but because this is a business-to-business relationship, different rules may apply. Consult with a lawyer in your state who has consumer law experience. The fraud element you mentioned concerns me, and it would be unfair and unreasonable for you to pay for invoices your business was not responsible for.
      0 Votes

  • 35x35
    Oct, 2011
    Victoria
    I attended a trade school and then decided I didn't like it so I dropped from the classes and the school. I still own them about $700 from the books because since I already opened them, I couldn't return them. This was in 2009 and then it was sent to a collection agency the beginning of 2010. So mid 2010 I paid $75 and then stopped paying. I know it's only been a year but I would like to not have to pay the remaining $700. Is there a lower amount I could ask to settle with? Also, I heard I can send them a "pay for delete" letter, is that true? I'd really like to do that so it can be off my credit report since it's lowering my credit score. Please help! Thank you!
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      You can attempt to negotiate both a settlement and a pay for delete, but the creditor does not have to agree to either. Keep in mind that you if you contact the creditor trying to work out a settlement in good faith, the collection agency can choose to accelerate collection efforts against you.
      0 Votes

  • 35x35
    Sep, 2011
    Maria
    Hello! I received a notice from a debt collector who is collecting for the California Dept of Transportation. This is dated 8/8/2011. I assume it was for a DUI accident I was in dated back to 2/18/2009. I was convicted on 6/26/2009 of a misdemeanor and ordered to pay the usual fees to the courts but not ordered to pay any specific entities. I received a bill for the CA highway patrol in 2009, which I paid... but never form the CA Dept of Transportation. This is not a judgement debt. I intend to write them to dispute the validity of the debt and request the name and address of the original creditor... but want to ask if in your opinion this has passed the Statute of limitations for California, especially since I have received no prior notice of debt? I know that you are not allowed to give legal advice, but ask for your opinion anyway. Thank you!
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      Thank you for understanding that I am not permitted to give legal advice.

      I don't believe that the debt you owe to the CA Dept. of Transportation would be subject to the statute of limitations.

      If you have any grounds for not paying the debt it would be based on, in my opinion, the fact that you were not ordered to do so by the court. I advise you to consult with an attorney, showing him/her the paperwork for your case and the court's ruling, to best understand your options. You need to be careful, as debts owed to state entities can quickly devolve into wage or bank levies, with no judgment required.
      0 Votes

  • 35x35
    Sep, 2011
    Armando
    My wife has a Sears credit card debt of almost $8,000 from a previous marriage that ended in 2005. She was unable to pay and the debt went to several collection agencies on 2006. A couple of months ago we received a call from Midland Credit Management offering to settle. We could not settle at the time but I agreed to pay $30 per month for the time being and agreed to talk later about settlement. We just received a call this month saying we could settle for $1600. The agent claims is a "special agreement with his manager" and that the account will be closed showing that we payed the approx. $8000. My questions are: 1)How can we be sure that if we pay the $1600 MCM will honor the agreement. 2) Does it happen that they offer mark as if the whole debt was paid when it won't or are there scams like this? and 3) Did I made myself vulnerable to being held responsible by allowing them to deduct $30 from my checking account even though the card is my wife's? Would appreciate your comment, Thank you
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      1) Before you pay the collection agent a lumpsum settlement payment, ask for a contract that states the debt is settled, and there will be no additional amount due. Before you sign the agreement, take it to a lawyer for review. He or she may suggest additional language to clarify the contract. 2) Collection agents buy collection accounts for pennies on the dollar, so start your negotiations to settle the debt at 10 or 15 cents on the dollar. 3) By paying a token amount on your spouse's account, you may have reset the statute of limitations clock on the debt back to zero. I do not see how you gave yourself liability for the debt, beyond which may have already existed.
      0 Votes

  • 35x35
    Sep, 2011
    Esther
    I received a collections letter for a debt I had back in 2004. The letter stated my account had been referred to a special investigation unit and they were instructed to seize any property I own. I live in California and I know the SOL is long overdue. Do they still have grounds to take my property?
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      The following chain of events must happen before a creditor can place a lien on a consumer's property:
      1. A summons and complaint must be filed against the creditor
      2. A hearing follows, which the defendant should attend. Raise the statute of limitations defense in this hearing. If the defendant loses, the creditor receives a judgment
      3. With the judgment in hand, a judgment-creditor can ask a court to
        • Garnish the judgment-debtor's wages
        • Levy the judgment-debtor's financial accounts
        • Place a lien on the judgment-debtor's real and personal property

      Consult with a lawyer in your state to learn more about your rights, liabilities, and exemptions.

      0 Votes

  • 35x35
    Aug, 2011
    Rupen
    My parents went through a divorce in 2006/2007 and hired lawyers. My old man called me up today telling me that his lawyer is billing him for $2,500 for unpaid services. He says that the lawyer did not contact him after the 'final payment' but was sent an itemized list of charges. The lawyer is claiming $2,500 in telephone calls, emails, and other such things that my old man never received. There was a signed contract for services and the last date of payment was in 2007. From what I understand, the statute of limitation is 2011 to file for those 'charges' which is just what this guy might be pulling. What can I use as the 'exact date' to start counting the statue of limitation? Any other advice?
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      Editor's note: Updated answer follows. The California statute of limitations starts with the date of breach. Consult with a lawyer (a different one) in the consumer's state to learn more.
      0 Votes

  • 35x35
    Aug, 2011
    S.
    Hi. A few months back I followed your advice on sending a debt validation letter to a law office that was trying to collect money from an old credit card debt. Before I get to their response, I would like to let you know that according to my credit reports, this debt was 30 days past due as of June, 2007; it is now August, 2011. Also, according to my credit reports, it was charged off and sold to Midland Credit Management and then somewhere down the line to the current collector: the law offices of Harris & Zide. In June, I sent a debt validation letter via certified mail to the law office and they responded roughly a month later. Their response was a letter saying that they were complying with my request for debt validation, and two photo copies of credit card statements from November and December of 2007. In the November statement, it shows that I needed to make a payment of $772.00 by November 29, 2007. In that same statement, under transactions, it shows a "pay by phone payment" line and another "payment" line under it, with posting days of 10/31 and 11/02 respectively. Now those two lines each showed an amount of $361.00 CR. Directly under that is another section titled: Purchases and Adjustments. Under that it had lines of "payment returned unpaid" and "return check fee." The first was on 10/31 for the amount of $361.00, and the second on 11/02 for the amount of $39.00. The December statement shows the charge off adjustment posted on 11/30/07 for the amount of $3,889.81 CR. Now my thing with those two statements is how did I supposedly make two payments, one by phone, within two days of each other, for the same $361.00, and on the same days get a payment returned unpaid of $361.00, plus a return check fee? Sounds a little fishy to me. Another funny thing is that by November of that year, this account had been delinquent for six months. That means I had no money to pay it at all. This looks like either a scam or it was the purchase price that Midland Credit Management paid for my account and they're masking it as me paying for the account. So here are my questions, and please pardon the amount of questions as I am very new to all of this:
    1. My credit reports are showing that I have been delinquent as of June 2007, but they're trying to say my last payment was November 2007. Which is correct? If it is June 2007, then shouldn't that be way past my four years SOL?
    2. In the debt dispute letter that I downloaded from your site and used to send to the collection office it states to provide the following: Explanation of why you say I owe this debt; Explanation of how you calculated the balance you say I owe; Copies of any papers that show I agreed to pay what you say I owe; Copies of any documentation establishing that the debt you say I owe is valid; None of those were properly met or provided. I mean, I didn't even receive a copy of the check that I supposedly used to pay the $361.00 with. So does this mean I can send them a notice of insufficient validation letter that can be downloaded from your site?
    3. Also, according to the debt dispute letter, there is a section that says: Request is made that there be no communication or attempts to communicate with the debtor at his/her residence or place of employment. I have received at least two phone calls from the law office since they received my dispute letter. Is that grounds to be able to make a complaint about that? And how would I do so?

    So that's my current situation. Thank you so much for your time and all the help/advice you provide. I am truly grateful for this site.

    0 Votes

    • 35x35
      Aug, 2011
      Bill
      Glad to hear Bills.com assisted you.
      1. I cannot speculate on the questions and points you raised here. If you do not recognize the payments supposedly made in November 2007, then it is entirely possible for a less than honest collection agent to make up payments to reset the statute of limitations to a later date. This is something to explore in discovery.
      2. A notice of insufficient validation certainly seems in order here.
      3. Once you send a do-not-contact notice, the collection agent or law office for the collection agent is permitted to contact you regarding pending litigation, but is not permitted to contact you for the purposes of collecting the debt.

      Should the collection agent or its legal representative file a lawsuit against you, I urge you to consult with a lawyer who has civil litigation or consumer law experience. It would be very interesting to pursue a line of questions to the collection agent or the original creditor regarding your discussion in point No. 1.

      0 Votes

  • 35x35
    Aug, 2011
    James
    I have a past due bank crdit card. Its been about 4-5 years since my last activity or payments. I live in Califonia and tried to remove this account of my report because its past " SOL ". Tans Union declined to remove it and the representative stated it will be removed with in 7 years... Has CA SOL changed or is trans union wrong in this case??? if so, how should i go about it ????
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      TransUnion is correct, in this instance. You are confusing your ability to claim the SOL as a defence, should anyone try to collect on the debt, with the laws governing what is reported by the credit reporting agencies.

      Even if you have no legal requirement to pay the debt, it is proper for the debt to continue to show on your credit report. It will stay on the report until 7½ years after the first delinquency.
      1 Votes

  • 35x35
    Aug, 2011
    marilyn
    I have a question. Someone who works for me helping to clean my home got a call telling her they were taking her to court for an unpaid loan. She was hysterically upset and so I called and gave the guy my credit card and charged $100 dollars and set up a payment plan that she was to sign. She did owe this money to a bank (it is on her credit report) but the debt was from 07 and the guy is not from the bank . I did not send back the payment agreement as I now wonder if this debt is still valid or if this is some kind of scam. We don't care about the $100 but the guy has my credit card # and I don't want to pay him any more. What do you think? Can I just call and send a letter saying I will not pay any more?
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      The first thing I would do is to call my credit card company and cancel the current account number. Otherwise, you leave yourself vulnerable to other charges appearing and the hassle of disputing them if they do.

      It is not clear to me whether the one payment you made will have re-set the clock on the statute of limitations, but it may have. If your employee had made the payment on the debt, it would have re-set the clock. Your making it on her behalf may have. If you want to find it if it did, I suggest that you speak with an attorney.
      0 Votes

  • 35x35
    Aug, 2011
    Jason
    Hi, I had a past due credit card account from citi bank, the last transaction on the account was May 08, 2007, then the account was sold to Midland funding in mid 2009 from a letter they sent me, i didnt know what to do so i ignored it and put it aside and i never get any calls from them, but last Oct they have filed a complaint on me for the debt they said i owed them, I filed a answer of general denial within 30days and never hear from them again. Few days later after i filed the answer to court, i sent a letter to the law office that was representing Midland funding to request a Validation of debt. and i have never hear from them since. It has been 9 months passed and the SOL has expired. What should i do now and how do i have the 3 credit bureau to remove the record
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      My answer assumes your case never went to trial, and the plaintiff either asked the court to dismiss the case or the court dismissed the case on its own authority. If my assumption is correct, the fact that the statute of limitations has passed on the debt has no bearing on whether the derogatory can appear on your credit report. A derogatory can appear for 7 years after the date of first delinquency. See the Bills.com resource Fair Credit Reporting Act to learn more.
      0 Votes

    • 35x35
      Aug, 2011
      Jason
      The case never went on trial and the plaintiff didn't dismiss the case, the case was still there, and we have called the court and asked them if the case was dismissed, they said no and the there is nothing i can do about it now but the plaintiff can file for hearing. Is there a rule that the case will automatically dismissed after certain length of time. and can they still go for hearing if SOL has expired?
      0 Votes

    • 35x35
      Aug, 2011
      Bill
      Generally speaking, courts strongly dislike zombie cases that are filed but not on the court's calendar. It surprises me your local court would allow such a case to linger unresolved and unscheduled.

      Consult with a lawyer in your state who has civil litigation experience. He or she will discuss filing a motion for dismissal with you, and the cost for doing so.

      In all states but Wisconsin, a plaintiff may file an action (a lawsuit) even if the statute of limitations has passed. However, if such an action is filed, the defendant has the right to raise a statute of limitations affirmative defense. If such a defense is raised in a timely manner, the court will dismiss the case. A court will not raise a statute of limitations defense for the defendant — the defendant must raise it on their own.
      0 Votes

  • 35x35
    Aug, 2011
    Anne
    My husband had an excellent credit, 6 yeas ago, before he had an accident in Arizona and they had to fly him out to get him to a hospital. At that time, we thought he was under his parents insurance. We didnt know that as soon as we got married, he has no insurance. We moved to california and his parents did not informed us of any medical bills. We only found out about it when he checked his credit report and there was a collection for $16,000+. Because of this, he stopped paying his credit cards and just let his credit get bad. It has been 4-5 years now since he stopped paying his credit cards. We get letters from different collection agency or lawyers but we never answered any phone calls or letters from them. Is it possible that he will get sued about it and will they directly get money from our account or his wages? How long does it usually takes before a collection company garnish wages? We are financially stuggling and we have no way of paying these debts. i checked my credit records and my husbands medical bill is now on my records too. can they do that? Will it help if he file bankcruptcy? I want him to file bankcrupcy for himself only, I still have a good credit.
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      I have four reading assignments for you:
      1. Read Served Summons & Complaint to understand the legal process for how a delinquency debt can become judgment, which can lead to wage garnishment, account levy, and liens.
      2. Read California Collection Laws to learn more about your rights and liabilities as a California resident.
      3. Read the Bills.com bankruptcy page to learn the basics of this legal process.
      4. Read California Spousal Debt to learn more about your potential liability.

      The medical debt should not appear on your credit report, unless you signed a document indicating you would pay for the medical services. Dispute the derogatory entry on your credit report to have this removed from your credit report.

      0 Votes

  • 35x35
    Jul, 2011
    Dennis
    My ex wife is taking me back for additional child support. My support order ends in two months.....she also wants me to pay for $15,000 in out of pocket medical expenses for our children over the last 10 years. She never gave me a single bill. I only heard from creditors after it was to late! What is the statute of limitations for out of pocket medical expenses?
    0 Votes

    • 35x35
      Jul, 2011
      Bill
      When it comes to child support, there are no universal rules or statutes of limitations. Judges look to the interests of the children. Consult with a lawyer in your state or your spouse's state who has family law experience to learn if what your spouse is seeking is fair and reasonable given her state's laws.
      0 Votes

  • 35x35
    Jul, 2011
    Joe
    I had to file Bankruptcy Chapter 7 in Oct 2010. My debts were all discharged on Jan. 4th 2011. This also included my First mortgage, and a Heloc. I did not reaffirm any loans. I have stayed current on my first and I am still living in the house. The last payment I made on the Heloc was in Sept. 2010. In Ca. what is the statute of Limitations on Foreclosure from the Heloc? I tried for 2 years to negotiate and didn't get anywhere and at this point they continue to do nothing. There is NO equity to even cover the first let alone the Heloc. I did get my credit report and it shows that I am CURRENT on my heloc. and that I still owe a balance. Yet the First says balance owed "0" and payment history current, which I am. Is this all a mess because of the BK and they don't know what to do? They told me for 4 months they were going to charge-off the heloc and release the Lien. Then all of a sudden they said they wouldn't do that. I'm not alone in my frustration I'm sure is it legal for the bank to Lie to consumers? I'd like to try to finish this up and stay in my house. Thanks Joe
    0 Votes

    • 35x35
      Jul, 2011
      Bill
      First, what appears in a credit report carries no more legal weight than a story about you in a newspaper. You can tell a newspaper reporter you are billionaire philanthropist, and if the newspaper prints that quote it does not make it accurate or honest. Similarly, what your mortgage servicer reports to the consumer credit reporting agencies is not a legal obligation on its part, and it what it reports may not be accurate.

      Second, a bankruptcy removes your personal obligation or liability for the note on your deed of trust. You could, if you wished, walk away from the property today and have zero liability for either deed of trust. However, you must continue to make your monthly loan payments or risk foreclosure. What I just wrote is true for any deed of trust — first, second, third, and so on.

      Third, if you acted in reliance on a mortgage servicer's promise, and then it later changed its promise, you may have a cause of action against the mortgage servicer. Consult with a lawyer in your state who has either real property, civil litigation, or consumer law experience to learn more about your rights regarding the servicer's promise.

      Finally, if you have any savings, open a negotiation with the second to learn if you can make a lump-sum settlement to resolve the debt.
      0 Votes

    • 35x35
      Jul, 2011
      Joe
      Well, I had another go-around with B of A. I received a "Notice of intent to accelerate" for the Heloc on Wed. Certified mail. I called them up and we setup a threeway call with the Escalation Dept. and the BK Dept. First I was told that this went out in error to me and to disregard it. Second we asked so what is the status of this HEloc? (remember I am still current on the first) SHE SAID, it has been charged off, and in a way that it must have been approved by the BK judge because its this way because there is no equity to keep the second. Then we asked so when does the Lien get released. She said it will be released when the property is sold. I then ask at what cost? and she says none. The loan has been charged off. SO I ASK AGAIN. SO to be clear your telling me in the future I can sell my house, and the heloc will not get or ask for any money to release the Lien? From ME personally or from the house? her answer was thats correct. I asked a few more times the same question and got the same answer. I then asked for this in writing. She said she couldn't do that but to write to an address she gave me and they would. NOW do you think this is just another LIE?!?! I have been lied to by them repeatedly. Thanks you Joe
      0 Votes

    • 35x35
      Jul, 2011
      Bill
      Using polite language, rewrite what you wrote here in a letter to the speakers in your conference call, and ask that they reply with any corrections to your understanding of the conversation. Be sure to include all that you can recall from the conversation, including the date and time of the call, and anything unusual that happened in the meeting, such as one of the participants being interrupted by a co-worker or other call that would indicate the truthfulness of your recollection of the meeting. You are trying to create an evidence trail that you should expect a judge to read in the future. Send those letters return-receipt requested, and if you receive no reply, follow-up with a copy of your first letter 30 days later. Keep copies of all of your notes and correspondence in two locations.
      0 Votes

  • 35x35
    Jul, 2011
    Jimmy
    Hi I had a question. If a debtor incurs a debt in Nevada and then moves to California, would the standard Statue of Limitations be in California since the debtor resides in California now or would it be in Nevada where the debt was incurred? If the Collection agency in Nevada attempts to sue the debtor and has their old Nevada address on file, and fails to serve that person because they dont have the new address, would they get a default judgement even though the debtor was never served? Also, is it ever a good idea to give a debt collection agency an updated address and phone number if it's close to the statue of limitations? Thanks.
    0 Votes

    • 35x35
      Jul, 2011
      Bill
      Statute of limitations questions are tricky to answer because I never have enough information, and the answers to these questions are very fact dependent. There are at least four key issues to a statute of limitations question:
      1. Did the parties agree to a choice of laws in their contract? Review the original contract, and look for a "choice of laws" clause in the contract. If the contract states which state laws the parties agree to use if a dispute arises from the contract, then there is the answer to your question. However, although choice of laws clauses are well litigated, some judges take pains to find reasons to ignore a choice of laws clause.
      2. Assuming the litigants reside in different states, what are the statutes of limitations for each state?
      3. How does each state's supreme court look at statutes of limitations conflicts with sister states?
      4. Is the plaintiff filing the case in its home state, or in the defendant's state of residence? And if it is filing the case in the defendant's state, is it asking the court to use a different state's statute of limitations?

      I realize your question seems straight forward: You signed a contract to borrow money in Nevada, then moved to California, so which state's statute of limitations applies? Even though I am familiar with both state's laws, I cannot answer your question without reading the contract and learning more about your circumstances.

      The default judgment hypothetical situation you described is not fanciful at all, as many fellow Bills.com readers will attest. Civil procedure law is clear: Both parties must be given adequate notice of a lawsuit. In reality, this does not happen because people move, process servers make mistakes and deliver the summons to the wrong addresses, lawyers use addresses that are out-of-date by 20 years, and so on. The mysterious thing about addresses is some lawyers use 20-year-old addresses for a summons, but magically uncover the defendant's current address once they have a judgment in hand, but I digress.

      If a defendant does not receive adequate notice of a lawsuit, he or she may petition the court to vacate the judgment. This does not answer your last question, because there is no right answer. Which tactic you wish to take, give notice of your new address or not, depends on your circumstances. Consult with either a California or Nevada lawyer who has civil litigation experience about this issue. He or she will analyze your situation in detail and give you a more nuanced answer than presented here.

      0 Votes

    • 35x35
      Jul, 2011
      Raquel
      Back in 2006 we had an issue with a car we had purchased less than a year earlier. The dealership wouldn't fix the problem and when we tried to trade it in we were told we owed more than it was worth. We didn't know that by returning the car to the bank was the same as a repossession, but that's what we did. Months later we had moved accross country from California to New York state. I just discovered today that the bank had gotten a judgement against me for the balance that was owed on the loan after the car was auctioned. At the time the remaining balance was $12,000. The reason I discovered it today was because I was stopping off at the market to buy hamburger buns only to find out that there was no money in my checking account. I went to my bank and was told that the debt was sold to a collection agency. They had an attorney drive around the area going from bank to bank to see if I had an account with any of them. Mind you I only had less than $100 in my account. When the attorney found where I did my banking he received $18 and the bank took a fee of $100 for their legal services which overdrew my account. I was told that this attorney can essentially go to my bank everyday if he so chooses and hit my account anytime he wants. Meanwhile, my bank will charge me $100 everytime he serves them. Botton line, I was never served in all these years to appear in court for a judgement. I didn't even know this had happened. I take it the SOL has reset since he took a payment from my account. Is there anything I can do?
      0 Votes

    • 35x35
      Jul, 2011
      Bill
      You can close your account with your bank, so the account does not keep getting garnished. You can try to negotiate a settlement with the judgment creditor. Please read some tips on how to negotiate with your creditors.

      Your creditor does not have to negotiate with you. If you are earning income and your wages can be garnished, the creditor may prefer to go after you that way instead of taking a lump-sum settlement from you.
      0 Votes

  • 35x35
    Jun, 2011
    Lucy
    I received several messages on my voicemail at home for the past 2 weeks and they stated that this is regarding a possible lawsuit against me and that I or my attorney need to call them back as soon as possible. They left a phone number with a 407 area code (Florida) 407-574-6453 and 407-574-7377. I Googled their number and it turns out they're a collection agency. To my knowledge, my credit has been clean for over 10 years. 4 questions: 1) Should I return their phone call and ask for a debt validation or should I ignore it altogether since I know that I'm way over the statute of limitations (California). 2) Another question is, instead of calling me, why don't they send me a dunning letter first? 3) Is it because my debt has been sold many times and they don't have my address? 4) Can they sue me if I don't respond to their phone calls?
    0 Votes

    • 35x35
      Jun, 2011
      Bill
      Below are answers to your questions.
      1. Return the collection agent's call, and ask for its contact information. Assume your conversation is being recorded, and do not admit to owing the debt. Send the collection agent an immediate request for a debt validation. Keep meticulous records and notes of all of your interactions with this collection agent. Use certified mail and keep copies of the receipts. See the Bills.com Debt Do-It-Yourself page for sample debt validation and other letters.

        The passage of your state of residence's statute of limitations does not prevent the filing of a lawsuit against your for a debt, except for Wisconsin residents. The passage of a statute of limitations gives the defendant an affirmative defense that, if raised in a timely manner, will cause the court to dismiss the case. The court will not raise the defense for defendants on their own — defendants must raise this defense themselves.
      2. The collection agent may lack your address.
      3. It is possible the collection agent purchased a bare account with little or no documentation.
      4. No law requires a creditor to speak to a consumer in person or on the telephone before filing a lawsuit against them. Were that the case, then deaf people or consumers without telephones would be immune from lawsuits, which would be terribly unfair.

      Consult with a lawyer in your state to learn more about rights and liabilities. You mentioned California. See California Collection Laws to get a start.

      0 Votes

  • 35x35
    Jun, 2011
    Anthony
    I had an equity line on my home that was foreclosed on. The last payment I made was in Sept 2006. I recently got a settlement letter via UPS to settle a $130k debt for $5k from the creditor. I wanted to know in California if my SOL has expired?
    0 Votes

    • 35x35
      Jun, 2011
      Bill
      The California statute of limitations for collecting a deed of trust deficiency balance is either four years California Code of Civil Procedure § 337 or three months under § 337 and § 580a depending on the circumstances. As I read § 580a, the date of sale is the significant date, and not the date of last payment.
      0 Votes

    • 35x35
      Jun, 2011
      Anthony
      Thank you so much for your quick response Bill. Would the date of sale be the date the foreclosure sale happened and the bank bought it or when another party bought it from the bank? The bank foreclosed on 11/30/07 and was sold on 3/31/08. In your experience do you think it would be best to settle or try and wait it out for the SOL to expire?
      0 Votes

    • 35x35
      Jun, 2011
      Bill
      The facts in your message confuse me. If the bank bought the house in the foreclosure sale, which occurred 11/30/07, then you can make an argument the California 580 statute of limitations starts on that date, assuming 580 applies. If the sale occurred on 3/31/2008, then that is when the SOL starts. Consult with a California lawyer who has real property experience to learn the precise start date, and which California statute applies to you.
      0 Votes

  • 35x35
    Jun, 2011
    Gina
    Are credit card companies allowed to solicit and approve immigrants for credit cars or credit? Would the same sol apply to them? How would this stand in court?
    0 Votes

    • 35x35
      Jun, 2011
      Bill
      If you mean, "non-US citizens" the answer is yes, a credit card issuer may enter into a contract with a resident alien. No jurisdictions, as far as I know, consider a person's citizenship when looking at a statute of limitations question.

      If you return to your native country, the SOL may stop running during the time you are out of the country, due to what is called tolling.
      0 Votes

    • 35x35
      Jun, 2011
      Irene
      I made a loan from HSBC in 2006 for my X-boyfriend who promised to pay it. We broke up and of course he stopped making payments. Me being a single mom tried my best to cont. paying his debt, but wasn't able to afford the ongoing expense. Well the ex ended up passing in a fatal car accident 2 years ago and they are still calling me. It was my fault for taking the loan out for him, but when I tried to at least make a good faith effort to settle and get it off my credit report, but they were being unreasonable with the settlement amount. So last week I received another call from a collection agency who purchased the HSBC lien. I told her I would be willing to settle 1/4th of the balance, but she threatened to send me to an attorney and said I would incur the atty fees. I told her I refuse to pay the amount given and to do what they had to. Can they still send me to an attorney? This loan was in 2006 and last payment made was like in 2007 maybee 2008?... What are the chances of them sending me to an attorney to garnish my wages?.. 2) Can I use the SOL defense?.. 3) Is it possible for them to refile the collection and re-start the SOL?.. 4)and when will it drop off my credit report? Hopefully you can help me out :)
      0 Votes

    • 35x35
      Jun, 2011
      Bill
      See the Bills.com resource California Collection Laws to learn more about your rights and liabilities. Whether you can use the statute of limitations affirmative defense depends on the facts of your case. The statute of limitations starts at the date of last payment or reaffirmation, and has no bearing on when lawsuit is filed. A derogatory of this type can appear on your credit report for 7½ years after the date of first delinquency.
      0 Votes

    • 35x35
      Jun, 2011
      Mike
      Did you sue his estate? Maybe he had some insurance? A retirement account? Death benifits etc.. ? or some assets. From your facts you had a loan out to him that his estate (if it had anything) would have to pay. Did he use the money to buy "one thing" maybe you are entitled to possession of what he purchased.
      0 Votes

  • 35x35
    Jun, 2011
    Mike
    Bill, what about after validating a debt (stupidly by being "baited" into responding to repeated correspondenses) which leads to a lawsuit on a debt that had expired years ago (say 12 year oral contract, which expired 10 years ago, but arguably was reaffirm by a written acknowledgement or partial payment) which is now in litigation. The question is ... Can prejudgment interest be awarded from the initial date of the loan/breach of contract or will the interest only be awarded from the reaffirmation date or even the date of the filing of the claim ???
    0 Votes

    • 35x35
      Jun, 2011
      Bill
      Consult with your lawyer about this question.
      0 Votes

  • 35x35
    May, 2011
    Cynthia
    Hi Bill, My state income tax refund was absconded by the EDD. When I contacted them, it turns out that I owed them money from 1990. Here is the back story. I opened a business for my father back in the day because he was in debt to the IRS. I had nothing to do with the business and it closed in 1990 afte my father became fatally ill. I "thought" that everything had been closed out proplerly. Flash forward to 2011. This completely hit me out of the blue. They told me the original taxes owed, which I have no problem paying. But the $700 plus in interest, I have a big problem. I have been in the same address for 15 years. I had been on unemployment a few times, I had even been in the EDD offices during those times for their employee assistance programs. At no time was I informed of this. Apparently the EDD is "Cleaning their files" and that this "Liability was recently opened." Do they have a right to do this for something that is over 20 years old? Thank you for any information. CA
    0 Votes

  • 35x35
    May, 2011
    Asunta
    Hi Bill! One event in my life in 2004 totally changed everything concerning my financial and credit stability. From having 800+ credit scores from all three credit reporting bureaus to practically humiliating and devastating scores probably up to now. I am not complaining; I am just doing my best each day to fix it. Last month, I requested my credit reports from the 3 bureaus and could not find the judgments against me on a credit card debt and eviction which I expected to stay on my report until 2013 (7.5 years total). I cannot afford to pay either of the two judgments. I also noticed that my other credit card debts on collection which I settled with the credit card companies and collection agencies are no longer listed under "Potentially Negative Items" except for two major credit cards with very small balances, one store card with a fairly high balance and a cell phone company with a very small balance. These four outstanding collection items recently passed the statute of limitations, though I wish to contact them and settle the debts in the near future. Though these debts are fairly small, I still cannot afford to pay them in full. I was wondering if I can use this time the statute of limitation and validate the accounts to persuade them to settle with me. In the past, I was able to settle with a fraction of very large debts, but could not do it with small debts. Also, with one of the outstanding credit card debts I mentioned above, I noticed on my credit report that it was transfered to a collection agency which they noticeably re-aged the account to March 2011. I have heard that collection agencies do this to trick people. Should I settle the account with the original credit card company and deal with the collection agency later? Must I file a complaint against them as well? I know now that they have little to hold on collecting on my debts because of the expired statute of limitation, but at the same time I realize they can still pursue me without going to court. Oh, and regarding the two judgments I mentioned above, do they automatically request the court to renew them, and do they go back on my credit report?
    0 Votes

    • 35x35
      May, 2011
      Bill
      I have four reading assignments for you:
      1. Answers to your collections questions can be found at the Bills.com resource Collections Advice.
      2. Read Debt Settlement Advice to learn the techniques and tactics for negotiating debt.
      3. Re-aging debt is illegal. Click on the hyperlink I just mentioned to learn how to handle this behavior.
      4. You mentioned statute of limitations. Just because a debt has passed the statute of limitations doe not make it uncollectable in most states. See California Collection Laws to learn more about your rights and liabilities as a California resident.

      After you read each of these resources, I encourage you to ask any follow-up questions you may have on the appropriate page.

      0 Votes

    • 35x35
      May, 2011
      Asunta
      Hello again! Thank you for taking the time to reply to my inquiries though I'm jealous that you didn't answer me directly. Instead, you put the links for me for a lengthy reading which was fun and very educational, I must admit. It seems like my brain always has space for more information. :) 1. Check. 2. Check. I must say that when I settled many of my debts on collection in 2006, I was like a "pro." I personally see myself armed with the techniques and tactics in negotiating with the collection agents without referring to any reading material pertaining to the matter. Most of the accounts were settled with less than the typical 40% to 60% of the total debt, though I must say that with debts like $1,000 or less, I had the most difficult time negotiating a settlement. Needless to say, they would not budge with my offer. I ended up paying with the full amounts. 3. Check. I re-examined my credit reports and cross referrenced the account I mentioned was "re-aged" by the collection agency. I suspect that the collection agency re-aged the account because the original creditor did not indicate on the credit report that the debt was "charged off." As mentioned in "Why Re-Age a Debt," item 2. preventing the debt from being reported as charged-off. A consumer may become delinquent on their debts temporarily. An agreement to re-age the debt to prevent the debt from being reported as charged-off will prevent damage to a consumer's credit rating. A consumer might be especially sensitive to their rating if they plan to purchase a vehicle on credit, refinance a mortgage, or qualify for a mortgage. There is no violation of the FCRA when the consumer and the creditor both agree to re-age a debt. I must mention that I have not given my consent or agreed to this re-aging. As mentioned further on the page, I will proceed to contact the credit bureau, provide them with proof of "Date of First Delinguency," have them investigate it, correct it with the collection agency's knowledge, and if they refuse to do so, I will file a complaint to the Federal Trade Commission. 4. Check. I have gathered that debts are collectible regardless of the statute of limitations. I was just hoping that without the collection agency's ability to sue me, I can negotiate with them with a fair and reasonable amount minus all the ridiculously high interest, fees and so forth. Ps. If judgments against are no longer reflected on my credit report and the other parties renew the judgment with court's approval, do they go back on my credit reports? Thanks again.
      0 Votes

    • 35x35
      May, 2011
      Bill
      Some creditors employ reasonable negotiators, and others are exceptionally sharp in their dealings with consumers. The fact that you did better than 40 cents on the dollar on most of your debts shows you have a knack for negotiating.

      Thank you for pointing out that if both the creditor and debtor agree to re-aging a debt, then there is no violation of the FCRA. I was sloppy with my explanation of re-aging debt.

      Regarding your question about a renewed debt and a credit report, here is FCRA § 605 (15 U.S.C. §1681c) "Except as authorized under subsection (b) of this section, no consumer reporting agency may make any consumer report containing any of the following items of information: (one sentences omitted) Civil suits, civil judgments, and records of arrest that from date of entry, antedate the report by more than seven years or until the governing statute of limitations has expired, whichever is the longer period."

      As I read this, renewal is irrelevant for the purposes of the FCRA. The date of the civil judgment is key, and not any other date.
      0 Votes

    • 35x35
      May, 2011
      Asunta
      Thank you very much for your very insightful advice and this website which is, in essence, a body of knowlege indisposable for everyone, at least to those who cannot afford expensive attorneys. Had I known this sight over half a decade ago, I wouldn't have gone through helplessness, self pity, unworthiness and without hope for my future. Now I can see a little light glimmering at the end of the tunnel.
      0 Votes

  • 35x35
    May, 2011
    Sandie
    I have a debt collector coming after me the debt was made in 1996 now they are trying to but a lien on my property an a judgement against me I was never served any papers although they say they did in 1997. I have no record of this. Is there someone I can talk to and is there a SOL on this debt
    0 Votes

    • 35x35
      May, 2011
      Bill
      I can't tell from your comment if you are stating that the collection agent claims that a judgment was obtained back in 1997 or not. Have you viewed your credit report to see if a judgment exists in the "public records" are of your report?

      A first step is for you validate the debt immediately, and take whatever documentation the collection agent provides to a lawyer.

      I can't give you legal advice, but will share some information with you for you to consider. There could definitely be statute of limitations issues present. If a judgment never was entered against you, the debt should have expired. Even if a judgment were entered against you, my reading of the California Code of Civil Procedure, sections 683.010 to 683.220, is that it states that a judgment issued by a California state or federal court, and any real estate liens associated with that judgment, lasts for only ten years. It is possible for a judgment to be renewed, but it must be done before the judgment expires.

      Do not pay a single penny towards this debt without first speaking with an attorney.
      0 Votes

  • 35x35
    May, 2011
    A.
    I am wondering if the SOL has run out on this debt. My husband had a debt w/ a bail bonds in 2001. He made an initial large payment and then small payments up to last invoice I show was in 2004. We just recently received a letter from a credit bureau now saying that we owe almost twice what the last invoice I have dated in 2004 and the date of the principal shows a date in 2009. if the debt is from 2001 and the last payment was from 2004 wouldn't SOL be up and they couldn't try to collect this money from us?
    0 Votes

    • 35x35
      May, 2011
      Bill
      Let me tackle the easy issue first: Just because a statute of limitations has run on a debt does not mean a creditor cannot try to collect a debt (except in Wisconsin). A creditor can even sue a debtor in a court of law in an attempt to receive a judgment. However, what the statute of limitations allows is the debtor to raise the affirmative defense of statute of limitations, and if raised in a timely manner the court has no choice but to dismiss the case immediately. A creditor can continue to try to collect the debt privately (again, except in Wisconsin).

      The difficult part of your question is determining the statute of limitations for a bail bond. Consult with a California lawyer who has experience in criminal law.
      0 Votes

  • 35x35
    Apr, 2011
    Jessica
    Okay, I have an unusual situation, at least I think I do. I was on my mother's insurance and went to the dentist to get my teeth cleaned. The service was on 11-15-05. However, for whatever reason the insurance denied the claim in 2007. I had not received notification from the dental group, because they were sending it to my mother and trying to collect payment from her. I found out about the debt after a debt collector called me last year, 2010, claiming that I owed the debt. After requesting verification they ignored me and sold the debt to a new collection agency. The new collection agency has been calling me non-stop. My boyfriend told them I will not be speaking to them over the phone and all communication needs to be done in writing, yet they still continue to call. The debt collector has my name on the account, but my mother's social security number. From calling the dental group directly I have learned that the amount owed is $504, but only $155.38 is for the service I received the other amount was my mother's service. My question is when does the statute of limitation begin? In 2005 when I received the service? I have never made a payment because the insurance covered it. I only made a $10 co-pay at the time of service. My second question is am I even responsible for this debt? and if so, would I be responsible for the whole amount or only for the $155, the amount of the service I received?
    0 Votes

    • 35x35
      Apr, 2011
      Bill
      Continue to validate the debt with each new collection agent that buys your collection account. Regarding your questions, which I assume concern a California debt and a California resident:
      1. The statute of limitations starts at the last date of payment or when the payment was due.
      2. Your second question is best answered by your insurance company. Why did it deny the claim? Was the denial acceptable by contract, or was it a frivolous denial?
      3. The ~$350 difference ($500 minus the $150) is related to what? Late fees and interest? Were you not covered by the insurance plan? If it is fees and interest, then those are completely the invention of the collection agents, and are negotiable.

      Regarding the cease communications notice, that must be in writing to the collection agent.

      0 Votes

    • 35x35
      Apr, 2011
      Jessica
      If there was never a payment because it was all previously covered by the insurance when does the statute of limitations begin? I am not sure why they denied the service. It is my mother's insurance so they will not talk to me. I was covered by my mother's insurance, as a dependent, and had previously had my teeth cleaned and they were covered. Even after this date of service they accepted a claim for the same service. I don't know why they chose to deny this particular instance. The $350 difference is for a service my mother received. The dental group billed both services on one bill.
      0 Votes

  • 35x35
    Apr, 2011
    Katie
    Hi Bills, I went to school in California back in 2007. I then moved to New Hampshire and JUST received a bill from my old school saying that they are charging me for a lost key when I turned mine in when I left. How do I dispute this and does the SOL apply? Do they need to provide proof that the key was lost? Thanks!
    0 Votes

    • 35x35
      Apr, 2011
      Bill
      My guess — note that word choice — is that California's 4 year statute of limitations for contracts applies. However, I hasten to add that before betting on my guess that you would be wise to review the documents you signed when you got your lab key, dorm key, or locker key, or whatever key is involved. Colleges and universities are not to be trifled with when it comes to owing funds. Something as minor as this can result in you not getting copies of your school transcripts. If the issue here is $50 or so, pay the ransom.
      0 Votes

  • 35x35
    Apr, 2011
    patrick
    With out acknowledging liability for the debt, does an offer for "pay for delete" restart SOL?
    0 Votes

    • 35x35
      Apr, 2011
      Bill
      If the debtor is cautious and states in negotiations that by negotiating, he or she is not acknowledging the debt, then there is no statute of limitations issue when discussing a day-for-delete.
      0 Votes

  • 35x35
    Mar, 2011
    Paul
    I purchased a golf membership in 2002. I gave a deposit of $20K, but I never used it. I gave them notice that I was terminating my membership, but they haven't returned it to me. Have I passed the SOL date of 4 years?
    0 Votes

    • 35x35
      Mar, 2011
      Bill
      Consult with a lawyer in your state who has experience litigating contracts. He or she will review your golf membership contract in person and advise you accordingly.
      0 Votes

  • 35x35
    Mar, 2011
    Eric
    Bill, I have an upcoming situation and think I know what course to take but would like your opinion. I co-own a home with my father who is ailing and will pass in the next few years. He as some credit card debt. When he dies, since the house is already in my name as co-owner, is it still a target for unsecured debt? Is it an "estate?" Or is it completely my house and protected from his debts? Thank you for any insights you can give.
    0 Votes

    • 35x35
      Mar, 2011
      Bill
      The phrase, "The devil is in the details," applies to your question. You and your father should take the property's title to a lawyer who has experience in property law, or wills, trusts and estates. He or she will review the title and tell you what your future interest is in the property given the exact phrasing in how the property is titled. Words have very specific meaning in property law, and there is a significant difference between a "joint tenancy" and a "tenancy in common" among others. The title may contain an executory interest as well to complicate matters. Without seeing the title, it would be folly for me or anyone else to say what rights you have in the property.

      Regarding the estate, that is anything and everything the decedent leaves behind, including assets, rights, and liabilities such as debts. As I mentioned at the start of my answer, consult with a lawyer who can create a will or trust for your father that clarifies how he wants his assets and liabilities handled upon his death.
      0 Votes

  • 35x35
    Mar, 2011
    Paul
    Iv lived in California my whole life. When I was younger I ran into a lot of problems and made bad choices and it caused me to have two repos. The last payment on one was on Dec of 2005 and the other a few months later. Iv been doing everything in my power to fix my mistakes but I don't have the money to fix the repos. So I guess my question is should they come off my credit report due to the SOL if I still owe them the same balance. Iv never talked to any creditor about them or been sued there just there and if so who or how do I contact them to exercise my rights and get them removed? Thank you for your help and your time
    0 Votes

    • 35x35
      Mar, 2011
      Bill
      What appears (or does not appear) on your credit report and whether the debt has reached its statute of limitations are separate issues. The repo could remain on your credit report for 7 years after it happened. That does NOT mean that you are legally liable for the debt that whole time. If you were not sued and there is not a judgment against you, it would appear that the SOL has passed.

      I recommend that you seek a free consultation with an attorney in California who can explain to you whether the debt is past the SOL. If it is, I suggest just waiting for the negative information to disappear from your credit report in about two years. One important thing to keep in mind is that you can re-start the clock on the SOL by making a single payment on the debt. If someone contacts you about this debt at any time, do not send them a penny without first consulting with an attorney.
      0 Votes

  • 35x35
    Feb, 2011
    Jennifer
    Hear one for you, I do live in California and I just gotten a phone call today from a collector ( an old gym) and it was back in 1990. Using my old last name when I was 18. They said that they received the collection paper work in 2004 sending me letters to my old address and wanted there money back about 650. (Its now 2011) I told them I canceled that membership and I don't keep my paper work for 21 years or so... are they kidding... I never had paid them or didn't even know about this... Is my statue of limitation over and can they still collect or sue me??? do I need an attorney???
    0 Votes

    • 35x35
      Feb, 2011
      Bill
      Assuming your last payment was in 1990, the statute of limitations on that debt has long passed in California and all other US jurisdictions. The creditor has the right to collect the debt privately. It also has the right to file a lawsuit against you. If it does, raise a statute of limitations defense to the court in a timely manner, and the court will dismiss the case. If you receive a court document called a summons or summons and complaint, that is the time to consult with a lawyer.
      0 Votes

    • 35x35
      Feb, 2011
      Jennifer
      Thank you for you answer, have another one for you. What about if they don't have my new address or new last name and they try to sue me and of course win cause they sent it to the old address... I don't want to give them any current information just cause they are now trying to find me after 20 yrs and yes the statue of limitation is over. Yes in 1990 was the last payment (it was only one) then I canceled the membership right away and I don't keep paper work for 20 yrs just 7yrs... Thank you for your information
      0 Votes

    • 35x35
      Feb, 2011
      Bill
      If the law firm representing the collection agent is scrupulous in following your state's laws, it will hire a skip-tracer to find you. If your name and address changed, and you have not left an online trail between your old identity and your new one using Facebook, LinkedIn, or other means, such as online high school yearbooks, then it will be difficult for the skip tracer to find you. If the skip tracer is highly motivated, he or she will use illegal means of tracing you, such as accessing Social Security Administration files or your DMV record. For a highly motivated skip tracer, finding you is trivial. However, highly motivated skip tracers are expensive, which makes it unlikely a law firm will hire one for a 21-year-old $600 debt.

      If the law firm is unscrupulous, it will not care if it delivers its summons and complaint to a 21-year-old address. It will take its default judgment, and then try to find you. But the unscrupulous law firm is stuck with paying an expensive, highly motivated skip tracer to find someone to collect a $600 debt.

      Your advantage here is you seem to have a connection to your old address, and are aware the collection agent is trying to contact you. If your old address receives a summons and complaint, you can hire an attorney to represent you. He or she will file the affirmative defense of statute of limitations, and end the collector's case against you.

      If the collection agent tracks you down to your new address, and sends you a collection letter, validate the debt immediately. If you do not have records from 21 years ago, chances are the collection agent does not either.
      1 Votes

  • 35x35
    Feb, 2011
    Denise
    I am hoping someone can answer this question. I have a friend who had a car repossessed back in 2003-2004 It was a 2001 Camry. he went through a messy divorce and for the last 6 years has had no credit at all... the other day I received a call from a collection agency looking to collect $23,000 on this debt (they were looking for him) This is the first time he has been contacted since the car was repossessed. now they have sent a couple letters to MY address looking for payment. My qusetion is, 1. Is the Statute of limitations up for this? 2. How do we know if a judgement was ever brought against him? (possible a notice went to the ex and she never told him) 3. If he responds to the letter asking for a copy of the debt or judgement does that reopen the statute? HELP! He is just getting his life back on track from her and I hate to see him fall back down!
    0 Votes

    • 35x35
      Feb, 2011
      Bill
      First of all, the debt collector is not allowed to speak with you about the nature of the debt your friend owes, how large it is, etc. When contacting a third party, the debt collector is restricted to inquiring as to the debtor's whereabouts in order to re-establish contact. From what you described, the collector violated the Fair Debt Collections Practices Act (FDCPA), the federal law that governs the behavior of debt collectors. To learn more about the FDCPA and your friend's rights as a consumer, visit the FTC's Fair Debt Collection Practices Act Web page.

      Regarding your specific questions:
      1. The statute of limitations (SOL) could be up, if the last payment made on the debt was as far back as 2004. Sending even $1 to the creditor can re-start the clock on the SOL, so your friend should not make any payment until the SOL issue is addressed. Your friend should consult with an attorney experienced with SOL issues.
      2. There is no sure-fire way to determine if a judgment exists against your friend. The best advice I can give is for him to check his credit reports to see if a judgment appears in the "Public Records" are of his reports. There is no requirement that judgments be reported to the credit bureaus, but they usually are.
      3. Requesting debt validation in and of itself does not re-start the clock on the SOL. However, the validation should not include words to imply the letter writer takes responsibility for the debt. In fact, it is wise to state the opposite in a debt validation letter.
      0 Votes

  • 35x35
    Feb, 2011
    Diva
    I'm looking up their phone number online which is 1888-350-5995/714-597-7519 everyone got the same story and they all say its a scam. I'm thinking if you have my home phone number why dont you have my home address Im sure the cops can get that. Everyone had the same story on this website http://800notes.com/Phone.aspx/1-888-350-5995/3 So now I'm at ease and I think its basically a scam bcuz the sheriffs can find you to serve you if they really wanted to the address I had is like 5yrs old so. Im cool now. Thanks Bill!
    0 Votes

    • 35x35
      Feb, 2011
      Bill
      Good grief. The folks at 888-350-5995 certainly are busy. Thank you for following up with this information.
      0 Votes

  • 35x35
    Feb, 2011
    Diva
    I have a big problem. So these credit card people from chase bank called me and said that they're gonna sue me for a credit card I had in 2005. Its now 2011 and their trying to get $500 out of me and it will be settled. They claimed that they have the summons and they need my address so a sheriff can give it to me. So I'm wondering is this a scam? Are they serious? Its been six years why didn't they come after me three years ago. They had an old address for me but a current phone number and this is the first time I've heard from them. I don't have no job no money no car NOTHING. My peoples is giving me 125 dollars to pay them but they gonna say they can't take that. Matter fact when I talked to them the first time they said the five hundred dollars has expired when I called again they had the offer back on the table. WHAT SHOULD I DO?????????????
    0 Votes

    • 35x35
      Feb, 2011
      Bill
      Keep in mind that if the statute of limitations (SOL) for collecting on your debt has passed, paying the creditor even $1 will start the clock over again on the SOL.

      Were you ever sued? A creditor needs to sue you and obtain a judgment, before collection efforts such as a wage garnishment or bank levy can take place. If they are trying to serve you a summons for a credit card debt that you have not paid on since 2005, I recommend that you speak with an attorney. You should be able to get a free consultation with an attorney. Ask the attorney if your debt has reached the SOL. If the attorney tells you that it has, explain to the collection agency that you are going to raise the SOL as your defense for not having a legal responsibility to pay the debt.

      Collection agents often violate the Fair Debt Collections Practices Act (FDCPA). They are not allowed to say anything they wish to pressure you into paying. To learn more about the FDCPA and your rights as a consumer, visit the FTC Fair Debt Collection Practices Act Web page.
      0 Votes

    • 35x35
      Feb, 2011
      Justin
      I also got the EXACT same call today, about a Chase account and how they have been trying to serve me at an old address! I have been a CA resident for 3 years and it was regarding a credit card issued in MI between 2003 and 2006. The woman kept firing out settlement numbers, none that I actually agreed upon, finally I told them I wouldn't agree to anything until they faxed me documentation. She said she would and I had 1 hour to respond or they were taking me to court. I haven't received any faxes yet. My story mirrors what Diva M's was, with an old address, a current number and work place, and a $500 settlement today...the rest by the end of the month. What is the deal here?
      0 Votes

    • 35x35
      Feb, 2011
      Bill
      It sounds like there are many different scammers out there, some of them singing the same, off-key tune. These scammers are trying to scare people into paying money that they don't not owe.

      The best advice that I can give is to be a skeptical consumer. Never pay a penny to anyone you are not sure you owe. You were smart to demand that proof of the debt be faxed to you! Keep in mind, too, that your legal requirement to pay on a old debt can expire due to the statute of limitations(SOL), so be very careful about paying on an old debt and possibly starting the clock over again on the SOL.

      Lastly, I would ask for a call back number for anyone that was calling me and pressuring me to pay on a debt. If the person refuses to give you number, that is a good sign that they are not legitimate. If you gain the contact number and still feel that you are being scammed, contact the police and make a report to the FTC (The Federal Trade Commission).
      0 Votes

    • 35x35
      Feb, 2011
      Justin
      Thanks Bill. The guy called me back and asked if I received his faxes, I have not received anything. I mentioned to him that if this was a legitimate attempt to collect a debt that I may or may not owe and it went to court, I would use the SOL as my defense. He said 'well yes that's true, but it depends on the state' I said I was a CA resident and it is 4 years, he said 'well it's from MI and MI is 6)...I know Michigan's IS 6, but how does that affect this situation?
      0 Votes

    • 35x35
      Feb, 2011
      Bill
      Some credit card agreements contain what is called a 'choice of laws' clause, which can set the jurisdiction for resolving disputes between creditor and debtor in a state other than the one in which the debtor resides.This could make the debt expire according to the time-rules for a state other than California, where you live. IF it were the case that Michigan's SOL rules apply, then your debt could exist even after the 4 years for California's SOL had passed.

      It is possible that the collector is still trying to scare you and is attempting to rebut everything you say in a way that pressures you to make payment. As you still have not received the faxes, being extremely skeptical seems wise to me.

      Consult with an attorney in California who has experience in civil litigation or contract law, asking him or her if your debt is subject to California statute of limitations rules or not as well as clarifying whether this is a legitimate debt or not.
      0 Votes

    • 35x35
      Feb, 2011
      Justin
      A fax DID finally come over, from James White at "SRS & Associates" in Temecula CA. The fax gives a case number and reference number, the original amount owed, the settlement amount (500 on 02/15 and the remaining balance by 02/28. Upon the payoff it will be reported to the credit agencies as paid in full, and my failure to comply will result in "reversal of the settlement offer and execustion of legal action"...This seemes pretty legitmate, but I couldn't find any info on that company name besides a bunch of references to NJ and some people saygin it was a scam, some saying they paid and the debt was removed....
      0 Votes

    • 35x35
      Feb, 2011
      Bill
      Do you think you owe the debt that SRS & Associates is referencing? Given all the reports online of this being a scam, I would be extremely cautious in divulging any personal information to this firm.You should make certain that you owe the debt, before you consider sending even one red cent in payment.
      0 Votes

  • 35x35
    Feb, 2011
    jesse
    I have an old credit card that fell into delinquency because of crazy fees when I became sick years ago. It would have had SOL but a creditor harassed me by phone and I ended up giving them all I had in my savings (not much). Anyhow it's now gone on to another creditor last year and I fear how I was treated before. I intended to send a letter stating what I can pay for a final payment until I read that they can cross out "cashing of this check constitutes payment in full" and continue to pursue me for it. I don't have anything they can garnish, don't own property, but would like to have this resolved and am not sure what my options are. I have read that sending a letter restating the intent of that check as acknowledgment it is final and full payment upon cashing, is what some people do. Have you heard this also? Thank you.
    0 Votes

    • 35x35
      Feb, 2011
      Bill
      What you describe is a restrictive endorsement, which is not a bullet-proof method to accomplish your goals. A better tactic is to reach an agreement with the collection agent to settle the debt permanently.
      1 Votes

    • 35x35
      Feb, 2011
      Jesse
      Thank you, Bill. I don't mean any of this to say that my intent wasn't to pay before getting sick. But what will happen if it physically impossible to settle near what they want? I mean if they want to go to court there's nothing I have to offer.....what would happen then or are there any options?
      0 Votes

    • 35x35
      Feb, 2011
      Bill
      You have heard the saying, "You can't get blood from a stone." That cliche is true in the law of remedies as well. If you have exempt (or no) assets and income, then there is nothing a creditor can collect from you. Some lawyers refer to people who own nothing but exempt assets and have exempt income as being judgment proof. See the Bills.com resource California Collection Laws to learn more about California's debt rules.
      0 Votes

    • 35x35
      Feb, 2011
      Daniel
      Jesse, I hope that you know that this debt will not follow you forever and will NOT lead to you going to jail if it turns out that you can never pay it. You will want to look at the statute of limitations for debt in your state. If your debts are sizable and there is a chance that your financial situation may improve in the future, you may want to consider bankruptcy as a way of discharging the debt. Good luck!
      0 Votes

    • 35x35
      Feb, 2011
      Jesse
      Daniel, I really appreciate your comment. I was harassed on the phone for months and now some guy is showing up at my home and knocking on my neighbors doors. Its one CC bill that got huge over rates and fees when I got sick-I tried asking them to lower rates but they wouldn't. The statute would have been up this year if I knew it existed but I was threatened with legal action and possible imprisonment if I didn't pay $100 a year and a half ago. So that changed my statute of limitations unfortunately. What I do have is enough to pay my basic bills and medical expenses, and my personal possessions which I am reading they can take? What I can offer them to settle and still stay on top of everything else is 4-7% of the total bill. I don't want to go to jail or lose my checking account for my current bills, and I don't want to have every other thing go delinquent just to get this one CC acct off my back you know? I did offer the first creditor a lot more a year ago when I had it available but they didn't accept and sold the account.
      0 Votes

    • 35x35
      Feb, 2011
      Bill
      I recommend that you read about your rights under the Fair Debt Collections Practices Act, because it sounds to me like you have been the victim of illegal conduct. Regarding the nasty calls that you received, you can generally stop collection calls by sending a cease and desist letter to the creditor who is harassing you. In fact, the Federal Trade Commission (the government agency that oversees consumer debt collection activities) states the following on its official Web site:

      "You can stop debt collectors from contacting you about any debt, regardless of whether you owe it, by writing a letter telling them to stop contacting you. Once the collector gets your letter, it may not contact you again except to say there will be no further contact or to let you know that the collector or creditor intends to take some specific action" which it actually intends to take. The collector can't make idle threats or tell you that will end up in jail. What the collector can say to any third party about you is severely restricted.

      A sample cease and desist letter can be found at here. The Federal Trade Commission has an entire Web page devoted to "Time-Barred Debts" — its term for debts that have past the SOL expiration date — where you can find even more information on this topic. See the Federal Trade Commission document FTC Facts for Consumers: How to Dispute Credit Report Errors for more information.

      Violations of the FDCPA are punishable and the collector could be forced to pay you, if you take action and prove the collector violated the law. I think you should speak with an attorney that specializes in these issues. They tend to work on a contingency fee basis, so you don't pay them up-front. Instead, they take a percentage of anything you win from the suit. Ask the attorney if the illegal threats that compelled you to make payment a year and a half ago could somehow allow the old SOL that would have expired to be reinstated as the SOL of record.

      If you are truly without assets or income that could be garnished and don't keep funds in a bank account that could be levied, then there is not much they can do to collect from you. In that case, working to minimize the creditor contact may be the best course of action. You can wait for the SOL to come up again. Alternatively, you could choose to offer them to accept a settlement amount that you can afford to pay.
      0 Votes

    • 35x35
      Feb, 2011
      Daniel
      Thanks for the shout-out, Jesse. Wow, that collector from last year really crossed the line when he told you that you would be imprisoned if you did not pay them. I just read what Bill advised you to do and I think he gave you some really good advice bout the FDCPA and steps you can take. Good luck with everything.
      0 Votes

    • 35x35
      Feb, 2011
      jesse
      Thank you so much for all of your help and this information. I just learned my family put a car in my name so I'm hoping that won't be an issue because its still not really my car. Either way I will definitely move forward with the info you've given me and find out what to do next. Thank you so so much.
      0 Votes

  • 35x35
    Feb, 2011
    Jennifer
    If I have debt that is beyond the SOL in my state (California), and I am NOT being contacted by collectors, but still wish to have the collection removed from my report... can I initiate a debt validation? Everything I find on the subject refers to requesting a DV within 30 days of being contacted, which I am not. What is the best way to remove a very old collection without: 1)renewing the SOL, 2)lowering my credit score, or 3) continuing to wait for it to "fall off"..
    0 Votes

    • 35x35
      Feb, 2011
      Bill

      Disputing the validity of a debt is NOT likely an effective solution, if you owe the debt. It could result in the account falling off your report, if your creditors did not respond to your dispute, but a creditor is unlikely to not respond when the debt is valid.

      The statute of limitations involves how long your debt remains legally collectible. What shows on your credit report is completely separate from the SOL issue. You can have a debt that is well past the SOL show on your report for many years. Making a payment of even a single penny can re-start the clock on the statute of limitations, as can making written commitment to pay the debt. It is even possible to bring a debt that has already expired due to the statute of limitations back to life! There are shifty debt collectors that specialize in buying expired debt who then try to trick people into paying them.

      Federal law (US Code Title 15, §1681c) controls the behavior of credit reporting agencies. This law is known as the Fair Credit Reporting Act (FCRA). Under FCRA §605 (a) and (b), an account in collection will appear on a consumer's credit report for 7.5 years. The clock starts approximately 180 days after the date of first delinquency on the account. To learn when an account will be removed by the credit reporting agencies (TransUnion, Equifax, and Experian and others), add 7½ years to the date of first delinquency. Subsequent activity, such as resolving the debt, is irrelevant to the seven-year rule.

      You have two choices.

      1. Pay the debt so it will show on your credit report as having a $0 balance. This will improve your score by clearing out the delinquent account, but could initially harm your score. The reason it can lower your score in the short term is that accounts with recent activity get greater weight in determining your credit score than older accounts. Once you pay on an account that has been dormant, your recent activity will increase that account's weight on your score, lowering it.
      2. The only other choice is to wait for the account to fall off your report.

      Aside from this debt that degrades your credit score, do you think that you have taken the right steps to address the other areas that make up your credit score? Make sure that you understand your credit score and how it is calculated. Please read about understanding your credit score and ask any follow-up questions on that page.

      1 Votes

  • 35x35
    Feb, 2011
    Dennis
    How do the CA SOL laws apply to student loans? I've been in dispute with a university since 2006 on a matter, and just received a new letter demanding payment in Feb 2011. I haven't acknowledged the debt, other than to send dispute letters and request documentation...with they can't seem to supply.
    0 Votes

  • 35x35
    Jan, 2011
    Erin
    In California - does the SOL start fresh when the debt is bought by a collector (in this case, a law firm "engaged in the collection of consumer debt")? This is regarding a credit card debt that I had disputed with the original debtor, and after a few years of getting nowhere with them, they sold the debt. I have not made a payment on this debt in over 4 years, but the law firm bought the debt in Aug 2007. Does that reset the SOL? The law firm called today to tell me they "have the paperwork ready to go" for garnishing my wages. I have never made a payment to them. Thank you in advance for your help!
    0 Votes

    • 35x35
      Jan, 2011
      Bill
      Two events can reset a statute of limitations, and several can "toll" a statute of limitations. Before discussing these events, allow me to caution you that statute of limitations questions are difficult to answer with a quick one-liner because these types of questions depend on the facts of the case. For example, many contracts have choice-of-law clauses that set which state laws will be used when litigating a dispute that arises from the contract. These questions also depend on the reader's state of residence. What is true for a reader residing in California may not be true for a New York reader.

      Here are the two events that can reset a statute of limitations:
      4 Votes

    • 35x35
      May, 2011
      Ken
      Actually, for statute of limitations purposes, CA CCP Section 360 seems to distinguish between making a payment on a debt that already has an expired SOL and making payment on a debt whose SOL has not expired. making a payment on the former can toll the SOL whereas making a payment on the latter has no effect and does not revive the SOL.
      0 Votes

    • 35x35
      May, 2011
      Bill
      I disagree with your conclusion that California Code of Civil Procedure Section 360 states, in effect, that making a payment on debt whose SOL has not expired has no effect and does not revive the SOL. The case law suggests otherwise:

      "...In 1947 Section 360 of the Code of Civil Procedure was amended so as to provide that the statute of limitations on a promissory note should not commence to run until the last payment of principal or interest made by the party to be charged prior to the time when the statute of limitations would otherwise have run. The purpose of this amendment was to make unnecessary the successive renewal of promissory notes and recording of mortgages or deeds of trust every four years in those cases in which the borrower continued to regularly make payments on account of principal or interest. The rule theretofore was that a payment on account of interest or principal would toll the statute only if in addition to the mere fact of payment there existed some acknowledgment of the debt or promise to pay it. This amendment has made it possible for lenders to carry borrowers without either commencing suit or compelling a renewal of the obligation so long as the borrower kept up his payments.

      "In 1951 Section 360.5 was added to the code, designed to prevent the exaction for purchasers or borrowers of an unlimited and indefinite waiver of the statute of limitations at the time credit was extended or a loan made. This amendment was intended not only to require that waivers of the statute be in writing but that no one waiver could waive the statute for a period of more than four years beyond the time when the statute would otherwise have run..." Carlton Browne & Co. v. Superior Court (Charterhouse Investment Co.) (1989) 210 Cal.App.3d 35 [258 Cal.Rptr. 118]
      0 Votes

    • 35x35
      May, 2011
      Ken
      I still disagree. Section 360.5 seems to deal exclusively with written, signed waivers executed by the debtor. "360.5. No waiver shall bar a defense to any action that the action was not commenced within the time limited by this title unless the waiver is in writing and signed by the person obligated." How does that apply to an individual who all of a sudden makes a payment on a credit card account which had already been in default for, say, 6 years? According to Section 360.5, it simply does not. Section 360 seems equally as clear that a new contract must be in writing and signed by the debtor. The section goes on further to talk about exceptions when dealing with promissory notes. There is a significant difference between a contract and a promissory note one of which is that the latter is a negotiable instrument. Bank of America and Wells Fargo claim that their credit card agreements are contracts and not promissory notes. Unless your bank is out of the norm, there is no promissory note on a credit card account. It would seem that for a credit card account already past the SOL, you need to have a writing signed by the consumer to revive the SOL.
      0 Votes

  • 35x35
    Jan, 2011
    Mariah
    My ex husband took out a loan without my knowledge before we got divorced and never made a single payment. The debt collector was about to sell our property but told me he wouldn't if I paid my ex husband's debt. I have already paid him $6,00 and I feel like he is adding excessive charges to the debt so I have asked him multiple times to send me a copy of the loan agreement signed by my ex husband so I can read the terms but he refuses to do so saying he can only give that to my ex husband. However, I think I have a right to see this contract since I am the one who will pay off the entire debt. Is there any way I can get a copy of this agreement or is he right in not allowing me to see it?
    0 Votes

    • 35x35
      Jan, 2011
      Bill
      My answer assumes you are a California resident, which I base on the page in which you posted your comment. California law does not allow foreclosure on a judgment lien. It does allow an Abstract of Judgment to be filed on the judgment-debtor's real property, but unlike a California mechanic's lien, a judgment lien does not allow foreclosure. (See the Bills.com resource California Collection Laws to learn more.)

      The fact that the collection agent misinformed you about California's collection laws gives me pause as to whether you have liability for your ex-spouse's debt, and if you do, how much of the debt remains. Assuming for a moment the collection agent is evil, he or she can continue to inform you more debt remains, and can hide behind privacy laws when you ask for the contract or an accounting.

      For the benefit of other readers, when you are first contacted by a collection agent, always validate the debt, but hurry because you have a limited time to do so. What should you do here? Consult with an attorney in your state who has civil litigation or consumer law experience. The most certain manner to settle this question is in court. You may need to file a motion for a declaratory judgment from a court that settles the amount owed on the debt, and who owes it.
      0 Votes

  • 35x35
    Jan, 2011
    Lisa
    I have an account that I overdrafted in 2007 and the bank has contacted me several times via phone/email and the amount they have is 400 dollars more than the original amount. I do not know if this is even possible, but I would like to know if there is a statue with the bank and also if I could pay the original amount and not the new amount?
    0 Votes

    • 35x35
      Jan, 2011
      Bill
      Your debt will definitely have a statute of limitations that is governed by your state of residence. Here is a chart that shows the statute of limitations for each state. I suggest that you should send a written request for validation of the debt. Send it by certified mail, with a return receipt requested. The creditor must then provide you with documentation that shows the original creditor, the amount owed, proof the debt collector owns the debt or has been hired by the original creditor to collect it. You can find a sample debt validation letter at the Bills.com debt self-help center. If you owe the debt, you are likely responsible for the fees and penalties that have been added on. You can attempt to negotiate with the collector, to see if a smaller payment would be accepted.
      0 Votes

  • 35x35
    Jan, 2011
    jason
    My girlfriend has been has been contacted by a collection agency about a debt that she paid off in 2003. Before this collection agency contacted her we had checked her credit report and nothing about this debt was on her report. the agency wants proof of payment from 8 years ago what should she do?
    0 Votes

    • 35x35
      Jan, 2011
      Bill
      You have it backwards. Your friend need not prove anything. Your friend should demand the collection agent validate the debt. Do so quickly because there is a time limit on demanding a debt validation. If the collection agent cannot validate the debt it may not reportthe debt to the credit reporting agencies or take any actions to collect the debt.

      The debt appearing or not on a credit report is almost meaningless regarding a collection agent's right to collect a debt. Just because a debt appears (or does not appear) on a credit report does not give a collection agent the legal right to collect a debt. A credit report is a means for a potential lender to assess a borrower's ability to repay a loan, and any additional uses of a credit report -- in hiring or setting insurance rates -- are a severe misuse of this tool, in my humble opinion.
      0 Votes

  • 35x35
    Dec, 2010
    Kenya
    The SOL date is that the date of the original debt from the original company you had the contract with or is that the date the collector that bought the account acquired the debt?
    0 Votes

    • 35x35
      Dec, 2010
      Bill
      Neither date is relevant to a statute of limitations if the debtor made a payment. The statute of limitations clock restarts when a debtor makes a payment or acknowledges the debt. That is why some original creditors and debt collectors cajole debtors into making a "good faith payment" of $5 or $10 per month. Each payment restarts the statute of limitations clock at zero.

      Acknowledging debt is a bit trickier. Acknowledgment can come in the form of a debtor writing a paper letter or e-mail to a creditor or collection agent and writing something like, "I wish to pay my $x,000 debt that you are attempting to collect." If you seek to negotiate a debt with a creditor, instead write something like, "I wish to open a negotiation to resolve the $x,000 you claim I owe. Nothing I write here acknowledges or in any way admits liability for the debt."
      0 Votes

  • 35x35
    Dec, 2010
    Bad
    I see the SOL is 4 years for a contractual debt, but what is the SOL if, say, someone overdrew their bank account in 2007? Or any other debt, for that matter, that does not involve a credit card?
    0 Votes

    • 35x35
      Dec, 2010
      Bill
      An agreement with a bank, credit union, or investment brokerage is a contract, and will follow that state's contract law and banking laws. Keep in mind that just because a statute of limitations has run, that does not mean the creditor cannot use private means to collect a debt. The statute of limitations is a defense that can be used in a court. It has no meaning, except in Wisconsin, outside of court.
      0 Votes

  • 35x35
    Jan, 2010
    Bill
    The time to raise a statute of limitations defense was when you were summoned to appear in the hearing to decide if you had breeched your contract with the bank to pay your credit card debt. If you did not receive a summons to appear, then I suggest you consult with an attorney now to determine your options.
    0 Votes

  • 35x35
    Jan, 2010
    nick
    i recieved a garnish due to not showing up to court where im being sued for a credit card that has a last activity from 8/2006. i cheched the ca court system and they filed this process back on 8/2007. based off of that do i have the right to file statute of Limitaition? If i do how do i do it in sother Ca?
    0 Votes

  • 35x35
    Jun, 2009
    Mark
    Your bankruptcy attorney will have all of your facts at hand to answer your question with authority. Generally speaking, at the moment you crossed the border into California with the intention of making the Golden State your residence, you became subject to and enjoyed the protections of California's laws. However, statutes of limitation can be tricky, and there may be relevant additional facts that create an exception in your case.
    0 Votes

  • 35x35
    Jun, 2009
    pa
    I moved from the state of Rhode Island last year in August and now live in California. How does that affect my statue of limitations if my debts all were from Rhode Island? I am trying to file for bankruptcy due to my current circumstance of being unemployed. But I still would like to know my rights. If anyone can reply, it would really help.
    0 Votes

  • 35x35
    Jan, 2009
    RAFAEL
    BILL THE INFORMATION IS INCREDIBLY HELPFUL AND MAY GOD BLESS YOU UN-MEASURABLY FOR YOUR GENEROUS EFFORTS.
    2 Votes

  • 35x35
    Jan, 2009
    Bill
    California statute of limitations is 4 years. The clock starts from the date of your last payment on that account. You did not restart the clock just by communicating with them on the telephone, that would only happen if you made a payment on the account, or acknowledged the debt in writing.
    4 Votes

    • 35x35
      Oct, 2012
      Cindy
      Bill, We received a medical bill that my husband remembers paying from Jan. 2003 (when his son was in the hospital) out of the blue in Oct. 2011. My husband ignored it at first, but then when the hospital wouldn't stop, he wrote them a letter letting them know that the account had been settled back in 2003. We heard nothing back for months, and then they sent a short note saying that upon further review that have decided to send it to collections. We have blemish-free credit, and have now after running a credit report yesterday, my husband has a "ding" on his credit and we are currently hoping to refinance which could ruin our chances. What recourse do we have? Should we initiate on-line disputes with Equifax, TransUnion and such? Not sure what to do, as we have never had anything like this before. Thank you for your time. I can see you're a busy person, as you have much expertise to lend.
      0 Votes

    • 35x35
      Oct, 2012
      Bill
      Yes, you should immediately initiate disputes with all three bureaus. The the statute of limitations on the debt in CA has passed (unless you did something to "toll" the SOL). Also, if the debt were reported accurately, it is so old that it should not appear on the report.

      If you can't refi until the account is off his credit report, it may take some time. You should find out if the lender views the collection account the way that you fear it may. Often, a borrower is not required to pay off collection accounts that are so old.
      0 Votes

  • 35x35
    Jan, 2009
    RAFAEL
    IN CALIFORNIA WHEN DOES THE STATUE OF LIMITATIONS BEGIN TO START CLOCKING. I HAVE A DEBT FROM 02 THAT WAS CHARGED-OFF IN 05. A SPOKE TO THE COMPANY AND I SAID THAT I HAD AN OLD DEBT BUT I WASN'T SURE IF THIS WAS IT SO I ASKED THEM TO SEND ME THE CERTIFIED ORIGINAL COPY. DID I RESTART THE CLOCK BY EVEN ACKOLEDGING ANY OLD DEBT. AND HAS MY STAUTE RUN OUT OR DOES IT START COUNTING WHEN IT IS CHARGED-OFF. PLEASE HELP I GOT 3 DAYS LEFT TO RESPOND TO THE COURT SUMMONS.
    3 Votes