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Question:
APR 23, 2012

Collections on 12-Year-Old Debt

We received a bill from a collection agency on an outstanding balance from 1995. Can they still send us a bill?

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Bill's Answer: Bills.com Resident Expert

A collection agency can contact you attempting to collect a debt for an unlimited amount of time — neither the limit on how long an account can appear on your credit report, nor the statute of limitations (the time period a creditor has to sue you to collect on a debt) prohibits a collection agency from contacting you to try to collect an old debt.

Credit Report Rules at a Glance

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 7½ 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 this rule. The seven-year rule does not apply to all debts, however. Here are four exceptions:

  • A tax lien can appear for seven years from the date of payment.
  • A bankruptcy will appear for 10 years from the date of the final order.
  • Federal student loans can be reported for as long as they are delinquent. (Private student loans follow the 7½-year rule.)
  • A civil judgment can appear for seven years, or the length of a judgment’s statute of limitations in the consumer’s state, whichever is longer.

Learn the lifespan of a judgment in your state at the Bills.com Statute of Limitations Laws by State page.

The start of the seven-year begins at the date of first delinquency, or if no payments are made, when the first payment was due. Review your credit report carefully to make certain the dates of first delinquency are reported correctly. Unscrupulous collection agents reset the date of first delinquency to stretch out how long a derogatory account appears on consumer’s credit report. This is illegal under the FCRA.

Just because a debt does not appear on a credit report does not mean the statute of limitations for the debt has passed. The opposite is also true: The passing of a state statute of limitations on a debt does not mean the debt may not appear on a credit report. The federal FCRA and state statutes of limitations are separate and independent of each other.

Whether a debt appears on a credit report does not establish legal liability for the debt. The opposite is also true: You may have legal liability for a debt not reported to the credit reporting agencies. Credit reports are not legal records of every debt a person owes.

Your Question

Just because a debt is removed from a credit report that does not mean the statute of limitations has passed. Federal credit report laws and a state statute of limitations laws are separate and independent from each other.

You are not required to pay the debt simply because a collection agency contacts you. Do not make any payment on the debt, as doing so could reset the statute of limitations, depending on your state's law, thus allowing the creditor to take legal action against you for this old debt. A collection agency's contacting you does not necessarily mean that you are legally obligated to pay the debt, nor does it mean that this 12-year-old account will reappear on your spouse’s credit report.

You are correct that most items can only appear on your credit report for seven years, while certain types of records, such a bankruptcy filings, are reported for ten years as mentioned above.

Since the deficiency balance on your spouse’s vehicle is more than 12 years old, it should no longer be appearing on his credit reports. I will discuss these issues below in more detail, but the bottom line is that your husband can be sued for this debt, but he has an affirmative defense he can raise to dismiss the case. That makes a lawsuit possible legally, but unlikely. Under the FCRA, the debt should not appear on his credit reports. Consider sending a cease communication letter to the collector, which will stop the phone calls.

Just because a statute of limitations has passed does not mean a creditor may not collect a debt, except in Wisconsin. The passing of a statute of limitations gives a defendant in a lawsuit an affirmative defense, and nothing more. See Statute of Limitations to learn more.

In most states, the SOL begins running from the date you last made a payment on the account. This means that if you paid just a few dollars to a collector a couple of years ago, the running SOL for that debt could have been reset. Also, keep in mind that the passage of the SOL does not forbid a creditor from calling you to collect on the debt; it simply provides you an absolute defense in court if the creditor files suit. You can generally stop collection calls by sending a cease and desist letter to the creditor. For more information about sending cease and desist letters, visit the Debt Do-It-Yourself page.

Your state’s SOL has nothing to do with how long accounts can appear on a credit report. If your state's SOL is five years, an account can appear on your credit report for two years after your state's SOL has passed. A new company purchasing your account cannot lengthen the time that the account can appear on your credit report. Be careful, though, because many debt purchasers try to change the date of last activity on old accounts so they appear on your credit report for a longer time.

Pull your credit report and carefully review the accounts in question to make sure that no unauthorized changes have been made. If you find any suspicious information on your credit report (for example, if this old debt has reappeared on your credit report under a different name) dispute the listings with the credit bureaus. See the Federal Trade Commission document FTC Facts for Consumers: How to Dispute Credit Report Errors for more information. To find out more about credit, credit scoring, and credit reports, I encourage you to visit the Bills.com Credit Resources page.

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

Best,

Bill

Bills.com

Comments (43)


John J.
Springfield, MO  |  April 23, 2012
My husband had a judgment against him dated Feb. 20, 2001, by Missouri law it should be expired as of Feb. 20, 2011. However it is still showing up on his credit report but it is showing up as a collection debt rather than a judgment under the public record section and they have changed the date so many times it's hard to keep track but it looks like they have something on the credit report dated 2008. They have also changed their name on it 3x (at first we thought it was being sold but it isn't we called and verified this, they have just changed the name). Now we're trying to buy a home and even thought it's been 10 yrs and the judgment is not renewed so it is legally expired it is still showing up and that one thing is keeping us from getting approved. He wrote to the credit bureaus and disputed it but all they've responded with is that it is his debt. We are aware that it was his debt but it should no longer be on there. Does anyone know what paperwork we'll need to provide to
  1. Get it off his credit report, and
  2. Have documentation a lender will accept to show this is no longer a valid debt while waiting on the credit bureau to update his report?

We'd love to be able to move forward with purchasing this home, but without proper documentation we can't. Any ideas/advice is appreciated!! Thank you!

Bills.com
April 25, 2012
Start with a copy of the judgment, or a related document showing the date of the judgment being Feb 1, 2001. Then also include a photocopy of the Missouri statute that spells out the lifetime of a Missouri judgment. Take this to a Missouri lawyer who has experience in civil litigation. Ask him or her to write a letter to the legal departments at the big three credit reporting agencies (Equifax, Experian, and TransUnion), explaining that if the judgment and related derogatories are not removed immediately, you will file an action against them under the FCRA, and your state's libel laws.
Annie T.
White Bluff, TN  |  April 16, 2012
In Tennessee, my husband just received a phone call today from a debt collection agency that just received the account on 3-20-12 from the bank where the debt was originally owed stating he owes $4,870.75. It is for a repossession on a truck from back in 2001. He no longer has the paperwork showing payments made to the bank after the truck was repossessed. This was not paid in full to his knowledge since the paperwork is no longer in his possession. Since this has been 11 years and this debt has not come to his attention until now, does he still owe this debt according to the Tennessee repo law? What should be done to ensure this is taken care of before they wipe out my bank account? If he does owe this and has to make payments? What amount would suffice to make monthly payments on, or do they settle in this case? Our knowledge has been with hospital bills so I am unsure as to handle this repo debt(secure loan from 11 years ago). We are having a wedding in June so I am afraid of this financial burden hindering us at this time. Thanks for your time.
Bills.com
April 16, 2012
You may feel your spouse owes the deficiency balance out of a sense of moral conviction, but he may not owe the debt as a matter of law. If the collection agent telephones you again, do not tell the caller you owe the debt or will agree to pay the debt. Instead, validate the debt. Follow the hyperlink I just mentioned to learn how to validate a debt. Debt validation is a consumer's best friend because a debt that cannot be validated may not be collected. If your spouse does not have any records of this debt, chances are the original creditor does not either.
Karen H.
North Swanzey, NH  |  April 07, 2012
I applied for a mortgage 2-1/2 months ago and my credit was excellent (around 800). TODAY I got a letter from a collection agency telling me I owe an $88 payment to an eye-care company from DECEMBER 2004, which is just about 7-1/2 years ago. Number 1, I pay medical companies (like my dentist, etc.) with a credit card so I have a record; this also means that there is no way I should have any outstanding debt. Unfortunately I don't have my credit card records from 7 years ago (who would keep them that long?!). I will be sending this company a cease-and-desist letter and disputing the charge, and from everything I have read they cannot contact me again or report this to credit bureaus, but I am furious and very exasperated by the timing. Could this $88.00 debt that I have never heard of before today show up on my credit reports when my lender re-pulls them just before closing? I am SO careful, I can't believe this has happened! Also I just looked at my Experian report and it shows absolutely nothing negative, so at least as of today with that bureau, nothing derogatory has shown up. Oh, I'm in New Hampshire (have lived here for 10 years).
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Karen H.
North Swanzey, NH  |  April 15, 2012
Any answers? Please?
Bills.com
April 15, 2012
It is unlikely one derogatory from nearly 7½ years ago will have much of an impact on a person with an 800 FICO score, so it is unlikely this one item will scuttle your home loan application. If your loan officer tells you otherwise, negotiate a pay for delete contract with the creditor. If, as I suspect, it is not causing you an issue, take a different tack and instead dispute the derogatory. Follow the links in my reply to learn more.
Rick L.
Pittsburgh, PA  |  April 06, 2012
I received a letter from a debt collector in Houston TX. It regards an electric bill that was run up in my name, at an address in Ohio I never lived at. I remember about seven years ago getting a call from the electric utility in Ohio when I moved, and they said I had this bill in my record. I said I had never lived at the address. I was told to send them proof, so I sent them stuff with my address on it from the time period of the bill. The electric utility dropped the issue. Now, what do I do that this debt collector has purchased this old discharged debt? I am going to send a debt validation letter, but if all they need is a computer printout stating I owe the old debt, what can I do? Funny thing, I just bought a house, litterally three weeks before this, and there was nothing in my credit. In fact, I get my report annually, and this has never been there.
Bills.com
April 06, 2012
A consumer's best friend in a situation like you described is a debt validation. Validate the debt immediately following the instructions on the page I just mentioned. A debt that cannot be validated cannot be collected.
Al G.
Houston, TX  |  February 27, 2012
I am receiving a notice from a creditor that evidently purchased debt from the city of Houston. They are claiming that I parked my old car in a tow away zone in January 2007. It is now February 2012. The creditor is in Milwaukee, Wisconsin. The Statue of Limitations is 4 years in Texas. The last notice I received was "final notice-credit bureau Listing" claiming that they will report the debt to my Credit Bureau. Can this effect my credit? Are they allowed to report the debt to my credit bureau now that the SOL of limitations has passed? I am contemplating buying a house soon and don't want this come back and haunt me :) Thanks!
Bills.com
February 27, 2012
State statute of limitations laws have nothing to do with the federal law (the FCRA) regulating what appears on a credit report. Yes, a new derogatory appearing on your credit report may have a negative impact on your credit score. If your credit score is on the border of qualifying you for a home loan, a new derogatory can push your score into the "no qualify" category. My advice? Clean up the mess before it appears on your credit score.
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Al G.
Houston, TX  |  February 27, 2012
So the creditor from Wisconsin that bought the debt from the city of houston can now put this new negative report on my credit? despite it being from 2007? Thank you for your help :)
Bills.com
February 27, 2012
Yes, if the derogatory item is less than 7½ years old, and the information is otherwise accurate, the collection agent may add the derogatory to a consumer's credit report. See the Bills.com article Fair Credit Reporting Act to learn more.
Erik J.
February 20, 2012
I recently received a call from the South Florida Group saying that I owe $5,000+ on a credit card that went delinguent in 2000. At that time, I had approximately $20,000 in credit card debt and I spent several years settling all that. It may be tough for me to find any paperwork saying that I paid this debt, not only because I have moved several times, but also because I did not always receive proof of payment when I paid off a card. My credit has been repaired for over two years now and this comes as quite a shock to me. Any help regarding my legal rights in this matter would be much appreciated. Erik
Bills.com
February 20, 2012
Don't acknowledge that you owe the debt, as you may not owe it. Validate the debt if you receive anything in writing. Check into the statute of limitations, to see if the collector is trying to collect on an expired debt.
Robin B.
West Palm Beach, FL  |  January 30, 2012
I received a call from a collection agency about an old credit card debt of 10 years ago in the amount of $1000. I was asked to make payments monthly but declined. I was told that this debt would be turned over to the IRS for collections and I would have to deal with them. Is this possible and will the IRS come for me for a debit owed to a credit card company?
Bills.com
January 30, 2012
You were told a complete falsehood, but I have to give the collection agent bonus points for creativity. The IRS collects taxes for the federal government. As such, it has plenty of work to keep its agents busy. The IRS is not a collection agent for delinquent credit card debts. I suggest you validate the debt.
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Robin B.
West Palm Beach, FL  |  April 18, 2012
The thing about the collectors try to gain monies on this debt, it is over 12 yrs old and was bought by this collection agency. The funny part is, I have another credit card from the company from which these people are trying to collect on. I am doing better and am making payments on time. The collection agency was calling me and hanging up on me when I would answer. I called them back and said, "You hang up on me when you call me and to please do not call my number again." So far I haven't received any more calls from them. And to date, I haven't received anything in writing in writing from them either. This began over 5 months ago so am I clear? Is the debt still owed?

I love you by the way. Such a wonderful thing you do and I'm sure I'm not the only one who thanks you.
Bills.com
April 19, 2012
Several thoughts:
  • Collection agents buy, sell, and trade collection accounts like kids with baseball cards. Your 12-year-old collection account may sit in a filing cabinet for another 10 years, or be traded to another collection agent next Tuesday.
  • If any collection agent contacts you in writing about this debt, be sure to validate the debt and use Certified Mail so that you have proof of delivery of your debt validation letter. Repeat this step for any collection agent who contacts you about this account.

A debt that cannot be validated may not be collected by that collection agent. A collection agent who receives a debt validation letter on an account it cannot validate may choose to sell or trade that collection account to another collection agent, who may take another crack at collecting the account from you.

I appreciate your thoughtful remarks — you are welcome!

Tess S.
Oakfield, WI  |  January 18, 2012
I just received a letter from Convergent Outsourcing Inc regarding a debt. I called and they informed me it was with AT&T from 1999 and I am required to pay the balance in full immediately. I argued with the lady and she hung up on me? In 1999 I lived in IL. I have resided in WI since 2001. I do not recall seeing this on my credit report nor do I remember ever owing anything to AT&T. Am I protected from the statue of limitations from IL? Am I required to pay this or should this be a thing of the past?
Bills.com
January 20, 2012
First, do not pay anything unless the collection agent can validate the debt. Send a debt validation letter immediately because there is a time limit for doing so. If a collection agent cannot validate a debt, it may not collect it.

Second, you mentioned Wisconsin. America's Dairyland protects consumers with an excellent statute of limitations law that outlaws the collection of debt that is older than Wisconsin's statute of limitations for that particular species of debt. Consult with a Wisconsin lawyer who has experience in consumer law. You may have just won a small amount in a lottery, so to speak.
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James C.
Nashville, TN  |  February 13, 2012
I found this thread because I received a letter from the same company (Convergent) saying that I owed $4,000 from an AT&T card from 1999 (just as you). I called the company immediately. They ask me to verify the last 4 of my social. I did, and they told me how much I supposedly owe. I have no recollection of this debt. I've bought 3 cars since 2001 and never had any problems with my credit. In 2010, I was a victim of identity fraud and meticulously reviewed my credit reports. I never saw anything like this on any one of them. Since your situation is so similar, I'm now wondering if this is a scam. If it is legit, what could they do to me? I have no outstanding debts from the 1990s that I am aware of. If I did, why was I unaware of them until 2012?
William S.
Fairfax, IA  |  November 14, 2011
I recently was contacted by a bill collector about a credit card account that went delinquent in 2000. It has not been on my credit report in the last 5 years that I have been checking my report. Not sure if it was on the report before that. I currently hold a cedit card that is in good standing from the company the collection agency says my delinquent account is from, the account numbers are not the same so they are saying this is an old account. I don't ever remember having a cedit card from this company they say the account was open in 1999 and went delinquent in 2000. Should I ask for the signed contract saying I opened the account? I'm not sure what to do at this point?? should I pay it or fight it. I just dont want this showing up on my cedit report 11 yrs later. I'm from Iowa not sure on the local laws Thanks for any help
Bills.com
November 14, 2011
By all means, validate the debt.
Chris R.
T/o Upper Darby, PA  |  November 03, 2011
i recently got a bill in the mail from a collection agency concerning an old bill from verizon in 2004. Iwent thrugh my records and found a check that i paid the account only problem is that i paid be phone and the check is only a receipt for my self and holds n ground as proof of payment, i tried calling the bank to get old statements but ive had no luck. from what ive been reading on the page its past the statue of limitations for pa and i shouldent even worry about it is that correct or how else could i handle this?
Bills.com
November 04, 2011
Just because a statute of limitations has passed does not mean a creditor may not collect a debt, except in Wisconsin. The passing of a statute of limitations gives a defendant in a lawsuit an affirmative defense, and nothing more. See Statute of Limitations to learn more.

My advice? Validate the debt.
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Teresa B.
April 22, 2012
I received a call from a collection agency on an AT&T bill from 1995 for $250.00. The number had been showing up on my cell but of course no messages. Finally the guy finally left his name and number and I had enough. It was a Sunday and we had company so I was not happy for the 2 calls. I called back. Asked who he was and what he wanted. The conversation went like this. Him? How am I talking to? Me? I,m Sure my number came up when I dialed you so what do you want, you keep calling? Him? It doesn't work like that I need your phone number? Me? I gave number. Him? Is this he said my mom's name. I said yes because she is in a nursing home and I handle her phone and other bills. Then he said she owes the bill from 1995. At this point I informed him I knew she did not and I did not want him to ever call this number again. At this point he said does she live at and he gave my address on OK. She of course does not live with me because of the nursing home in MS. Then he stated he would mail her a letter to my address. At this point I informed him I did not want a phone call, a letter, or to hear his company name again or I would sue them. May have got carried away. My Mom phone bill has always been less than $25.00 a month because she gets a break for getting help. We have 3 cell phones, internet service, and pay a bill over $200.00 a month to AT&T a month now not counting my mom's $25.00 bill at the nursing home. These is in her name has been since she lived with us since 1999. If this was owed in her name how have we had this service all these years with no problem. She has always had the same land line number phone number. The only thing I am worried about is did I go to far of the phone?
Bills.com
April 23, 2012
The next time a collection agent calls about an oddball debt and doesn't seem to know who they are talking to, do not give them any information. Say you want them to send you the information in writing, and that you plan to validate the debt. When they write, validate the debt.
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