Receiving a collection letter for an old debt can catch you off-guard. Did you know that creditors can still send you collection letters even after the statute of limitations has passed? How can they do this? The laws in place to protect you from being sued over an expired debt do not prevent collectors from contacting you after the statute of limitations has expired.
In California, the statute of limitations is four years. Meaning, after four years, a creditor can no longer sue you for a delinquent debt. However, it is important to keep in mind that a statute of limitations does not prevent a lawsuit from being filed in most states, determine how long a debt can appear on your credit report, or permit you to ignore a court summons.
So, what can you do? Well, the best defense for yourself is knowing when the statute of limitations expired for your debt. Take time to figure out when the last payment was made on the debt. Next, count 180 days from that time to find the date of breach. You can send a letter to collectors to let them know that you do not want to be contacted further due to the debt’s statute of limitations having already passed. Do not make promises to pay anything back. Also, do not acknowledge the debt at all. If you do, this can start the statute of limitations over again. Click here for a link with a suggested letter template.
Do you still have questions or are you wondering about bankruptcy? Call for a consultation to find the best course of action for your specific situation.