Using Statute of Limitation to Your Advantage

The statute of limitation is a period of time within which a collector can sue you in a court of law in order to force you to pay on a debt. This time period starts from the last date that the account saw activity. Different states have different time periods for statute of limitation on debts.

It is common enough for debt collection agencies to try and collect on a debt even though the statute of limitation on the debt is over. They may threaten you with a lawsuit in hopes that you may not be aware of your statute of limitation and may agree to pay them. There are two things that you should know at this point of time. First of all the debt collection agency is under the violation of the FDCPA by threatening you with a lawsuit when it knows that it won’t or cannot file a lawsuit. The second thing that you should know is that while the statute of limitation tremendous a collection agency from suing you in a court of law for the debt recovery after the time period is over, it does not prevent them from making collection efforts.

If the statute of limitation is over on your debt then it’s possible that you do not have to pay on your debt at all since you cannot be sued for it. However the one thing that you must be very very careful about is not starting the statute of limitation all over again. Making a payment, making a promise of payment, entry on a payment agreement or making a charge using the account can recharge the statute of limitation on an account. This is why you should be very careful with any kind of communication with the creditor or the debt collection agency. If you reset the clock on your statute of limitation, it will start right at the beginning and be valid for the further tenure of whatever the statute of limitation was initially.