New York Statute of Limitations & Utility Bill

According to the Laws of New York CVP Article 2 § 213, a plaintiff has six years to take action on a contractual obligation or liability.

However, CVP Article 2 § 213 concerns using the courts of New York to get a legal remedy for a debt. Parties are not bound privately by CVP Article 2 § 213. By that I mean, the utility may be time-barred from asking a New York court for a judgment regarding your $116 unpaid bill, but it is not barred from collecting the debt privately. The utility is within its rights in New York to refuse to do business with a former customer who has an outstanding balance on their account. (This is not the case in all states, however.)

Therefore, even though the statute of limitations has passed, it is within the utility's right to condition doing business with you on your making your account current.

To learn more, read New York's Debtor and Creditor state statutes.

Seven-Year Rule

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 the seven-year rule. However, if the debt is a tax lien, that can appear for seven years from the date of payment. A bankruptcy will appear for ten years from the date of the final order. Delinquent federal student loans can be reported indefinitely, i.e., for as long as they are delinquent.

Here, the unpaid bill can appear on your credit report from the month in 2003 that the account became delinquent plus 7½ years. The date that you paid the balance due is irrelevant to the seven-year rule. Monitor your credit report to be certain this derogatory entry is deleted at the appropriate time.

See the Bills.com resource Collections Agencies, Collections Laws and Your State's Statute of Limitations to learn more about the nuances of collections, and what the statute of limitations does and does not mean.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com