Statute of Limitations on Debt

Statute of Limitations | Scales of justice balancing a clock & currency

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IN THIS ARTICLE:
  • Review your state's statute of limitation laws.
  • Get statute of limitation laws on various types of debt.
  • Understand that statute of limitations issues can be complicated and may require consulting with an attorney.

Statute of Limitations Laws by State

Below find consumer statutes of limitations laws for the 50 US states and the District of Columbia. Use this as a starting point for your research — it is not legal advice. Consult an attorney for legal advice specific to your situation.

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The statute of limitations listed below concern breach of contract. This is the legal reason a creditor must use to file a lawsuit against a delinquent borrower. Statutes of limitation vary by debt type. A statute of limitations clock usually starts the moment a borrower becomes delinquent on a debt. The clock can be paused if the debtor leaves the country or even the state, depending on state law.

An expired statute of limitations clock does not mean the original creditor is stopped from filing a lawsuit against a delinquent debtor. (An exception to this rule applies to Mississippi and Wisconsin residents.) An expired statute of limitations gives a borrower an affirmative defense he or she can use as a shield to stop a lawsuit. A borrower must inform the court the statute of limitations defense applies — a court will not raise this issue on its own.

Beware
Some Internet commentators simplify statute of limitations rules to a phrase like, “An original creditor can’t sue you if the statute of limitations has passed.” This is a false interpretation of the law in all but two states. However, courts have decided the FDCPA bars collection agents from suing consumers for expired debt.

Some creditors file lawsuits against delinquent borrowers even though the statute of limitations clock expired. Creditor do so because, unfortunately, many consumers do not understand their rights or hope if they ignore a notice of a lawsuit (called a summons and complaint) it will go away. Consult with a lawyer in your state immediately if you receive a notice of a lawsuit. You must or you will lose by default.

Read the Bills.com article to learn more, including which statute of limitations applies to your situation.

You might wonder what other state laws apply to you. To learn more about your state's rules for wage garnishment and related exemptions, see the Bills.com page.

  Statute of Limitations on Debt Community
Property
Judgment Rate Mortgage
Anti-
Deficiency
Credit
Card
Verbal
Contract
Written
Contract
Judgment1
Alabama 3 6 6 or 10 20   12.00% No
Alaska 3 3 3 10 Yes 10.00% Depends2
Arizona 3 3 6 5 Yes Fed + 5 Yes
Arkansas 3 3 5 10   10.50% Depends3
California 2 or 4 2 4 10 Yes 10.00% Yes
Colorado 6 6 6 20   8.00% No
Connecticut 6 6 6 10 or 20   10.00% No
Delaware 4 3 3 5   FedDisc+5 No
D.C. 3 3 3 3   70% IRS% No
Florida 4 4 5 20   10.00% No
Georgia 4 or 614 4 6 7   12.00% No
Hawaii 6 6 6 10   10.00% No
Idaho 4 5 10 20 Yes 9.00% No
Illinois 5 5 10 20   8.00% No
Indiana 6 6 10 20   10.00% No
Iowa 5 5 10 6   Treasury+2 No (PDF)
Kansas 3 3 6 5   FedDisc+4 No
Kentucky 5 5 15 15   12.00% No
Louisiana 3 10 10 10 Yes 9.00% No
Maine 6 6 6 20   7.50% No
Maryland 3 3 310 12   15.00% No
Massachusetts 6 6 6 20   10.00% No
Michigan 49 6 6 10   20.00% No
Minnesota 6 6 6 10   6.90% No
Mississippi11 3 3 3 7   5.00% Yes
Missouri 5 5 10 10   Contract No
Montana 5 5 8 10   9.00% Depends3
Nebraska 4 4 5 55   Prime+2 No
Nevada 413 4 6 10 Yes 9.00% No
New Hampshire 3 3 3 20   10.00% No
New Jersey 6 6 6 14   Varies No
New Mexico 4 4 6 20 Yes 8.75% No
New York 6 6 6 20   8.00% No
North Carolina 3 3 3 10   10.00% Depends4
North Dakota 6 6 6 6   Bond+1% No
Ohio ?6 6 8 or 158 57   12.00% No
Oklahoma 3 or 5 3 5 5   10.00% Depends4
Oregon 6 6 6 10   T-bill+4% No
Pennsylvania 4 4 4 5   6.00% No
Rhode Island 10 10 10 20   9.00% No
South Carolina 3 3 3 10   Prime+4 No
South Dakota 6 6 6 10   12.00% Depends3
Tennessee 6 6 6 10   10.00% No
Texas 4 4 4 10 Yes 10.00% No
Utah 4 4 6 8   6% or 18% No
Vermont 6 6 6 20   12.00% No
Virginia 3 3 5 8   Contract No
Washington 6 3 6 10 Yes 9 Depends4
West Virginia 5 5 10 20   10.00% Depends
Wisconsin12 6 6 6 20 Yes 12.00% No
Wyoming 8 8 10 5   12.00% No
Notes 1. Judgments can be renewed in many jurisdictions. In some cases, even a dormant judgment can be renewed.
2. The lender can collect a deficiency after judicial foreclosure, but not on a non-judicial foreclosure.
3. The lender can collect a deficiency depending on the type of foreclosure.
4. The lender can collect a deficiency after judicial foreclosure.
5. If the judgment-creditor sits on their rights for 5 years, the judgment becomes dormant (Nebraska Revised Statute 25-1515)
6. See the Bills.com resource Ohio Collection Laws.
7. Five years, then becomes dormant unless revived by the judgment-creditor (Ohio Revised Code 2329.07)
8. 15 years for actions accrued before Sept. 28, 2012, and 8 years for actions accruing after that date (Ohio Revised Code 2305.06 as per SB 224)
9. See Fisher Sand and Gravel Co v Neal A. Sweebe, Inc, 293 Mich App 66; 810 NW2d 277 (2011), lv gtd 491 Mich 914; 811 NW2d 496 (2012)
10. Default is 3 years, but can be 12 years for "special" contracts.
11. Upon expiration of the statute of limitations clock, the creditor loses the right to file a lawsuit. “The completion of the period of limitation prescribed to bar any action shall defeat and extinguish the right as well as the remedy.” Miss. Code Ann. 8 15-1 -3.
12. Upon expiration of the statute of limitations clock, the creditor loses the right to file a lawsuit. “When the period within which an action may be commenced on a Wisconsin cause of action has expired, the right is extinguished along with the remedy.” Wis. Stat. 8893.05.
13. See Nevada Collection Laws for a discussion of how Nevada state courts view statute of limitations for credit cards.
14. See Georgia Collection Laws for a discussion of how Georgia state courts view statute of limitations for credit cards.

 

280 Comments
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  • O
    Olga Nelson,
    Jun, 2020

    I owed $4000 maybe or less from a credit union over 10 yrs ago. If I were to apply for a bank account at the same place would I be able to?

    • 35x35
      Daniel,
      Jul, 2020

      Olga, with all the places to choose from, it doesn't sound like a good idea to open an account at a place you owe money. They may not let you open an account, but if they do and subsequently assert a right of offset for the old debt, I think you would see money taken from the account and you having no recourse to contest it.

  • T
    Tre,
    Apr, 2020

    I have a student loan that they purchased from AES and want the full amount of 7,000. Will they not take monthly payments?

    • 35x35
      Daniel,
      Apr, 2020

      Tre, it is possible that they won't accept a monthly payment that you can reasonably afford to make. If they don't, how they will pursue collecting depends, in large part, on whether your loan was a federal student loan or a private one.

      AES services both federstudal and private student loans. Federal studnent loans can lead to wage garnishment without being sued and tax refunds can be seized.

      Private student loans don't end up with a wage garnishment unless you are first sued and a judgment is issued against you.

      The bottom line is that they probably are trying to get you to agree to as large a payment as they can. Try and negotaite a payment you can afford. 

  • K
    Kim,
    Dec, 2019

    So, I signed up for a dating service back in 2016. They were an expensive match making company. It sounded like a great idea, if it had worked they way they explained. Anyhow, I was extremely disappointed in the service and customer service and decided to cancel it and stop paying. They tried to get me to pay, but I told them that they did not hold up their end of the bargain with the services they promised when I signed up. I signed a contract agreeing to pay, but I cancelled the credit card once I became dissatisfied with their service. I live in Virginia, and I signed the contract in April of 2016. The issue is they only gave 2 weeks to cancel the contract, but it took them over 3 weeks to set up the first horrible match. I never even had a chance to test the service within the cancellation period. There has to be some law that stops organizations from doing this to people.

    • 35x35
      Daniel,
      Dec, 2019

      I am not sure what kind of law you envision. Here are two possible actions you can take. You could contact the Attorney General's Consumer Protection Division in your state. You could speak with a lawyer about suing them to see if the lawyer feels you have a case.

  • ,
    Sep, 2019

    A credit card debt was incurred in 2006 past due in Delaware. Thought it was gone. Moved to NC and now 2019, collector is calling about it. Never showed up on credit report after 2016. Are they outside of statute of limitations or do they get a new clock.? Ive asked for validation of debt.

    • 35x35
      Daniel,
      Sep, 2019

      First, whether or not a debt appears on a credit report doesn't determine if you owe it or can use the statute of limitations as a defense if sued.

      If you were in Delaware, the SOL on credit card debt was four years and 3 years for a written contract. The SOL clock starts running on the date of first default, the date your payment was due but not made. SOL issues can be tricky. It is possible that the contact agreement provides that the laws of a certain state with a longer SOL apply or the creditor asserts you did something to eitehr toll the SOL (stop the clock from running) or restarted it.

      You took the right step in validating the debt. Look carefully at the language of any communication from them and avoid any commitment orally or in writing about your responsibility for the debt. If you are sued, use the SOL as a defense, being sure to answer their summons or complaint and to appear in court.

      I think they are just trying to intimidate you into paying. 

  • ,
    May, 2019

    I got a letter from Portfolio Recovery from a debt from 2009. Is this past the statue of limitations? They said the last time they talked to me was 2013. Did I screw up saying I would settle for $245?

    • 35x35
      Daniel,
      May, 2019

      You didn't give enough information to offer a good answer. Statute of limitations on debt are state specific. Look at the chart on this page for your state and see how many years it shows for credit card debt.

      In some states, a verbal commitment to make payment can restart the clock on the SOL. Check with your state's Office of Attorney General, Consumer Protection Department to hear if this is the case in your state. It probably isn't, as it is not the rule in most states, but .you should check and find out.

      I recommend that you don't speak with them again, if you haven't bound yourself to an agreement to pay.  Send them a cease communications letter you can find here. That doesn't stop them from writing, but it does stop calls.;

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