When is a debt too old for collection?

Statutes of limitation vary by state

The Credit Guy columnist Todd Ossenfort
Todd Ossenfort has been chief operating officer for Pioneer Credit Counseling since 1998. He writes our weekly "The Credit Guy" column, answering reader questions about credit counseling and debt issues.

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Question for the CreditCards.com expert

Dear Credit Guy,
I am getting calls from a collection agency saying I owe $35,000 on a credit card that I know nothing about. I have not received a statement or a call from this credit card company in the last 13 years since the account was opened. The address on the card has changed three times, and I have never moved from my present address. I have tried talking to the credit card company, and they will not give me any information except to say the account is in my name and Social Security number. I have asked for a copy of the original contract where I applied for the card and statements of purchases made, but they will not provide me with that information. I just need to get to the bottom of this. What can I do? -- John

Answer for the CreditCards.com expert

Dear John,
From your letter, it sounds as if you are not sure if the account belongs to you or not. My recommendation is that you first get copies of your credit report from all three major credit bureaus at AnnualCreditReport.com. Review your credit reports and determine if the original credit card account and collection accounts associated with it appear on your credit report. Next, dispute any accounts that you believe are associated with this account with the bureau that reported it. You can file the dispute online or by mail, and you can locate the information needed to do so on your credit report or the bureaus' websites. The credit bureau that is reporting it will have 30 days from the time it receives your dispute to delete the information if the account is not accurate.

If the original account has been inactive for more than 13 years, and if that account or any collection accounts associated with it should appear on your credit report, it should be removed. This is due to the Fair Credit Reporting Act (FCRA) rules of how long negative items may be reported -- most are seven years from the first date of delinquency. So, if any collection accounts associated with your credit card account are listed, the credit bureau should end up having to remove them due to the FCRA requirements. Moving forward, I would plan to check your reports annually, just in case another collector purchases the debt and reports the account to the credit bureaus.  This is a good habit to get into, regardless of your situation.

The collection attempts associated with the account are a totally different animal. After 13 years, the account is past the statute of limitations (SOL) for collecting an unsecured debt in every state. However, the SOL does not prevent collection agencies from trying, particularly when the debt owed is $35,000 and the company likely paid pennies on the dollar to purchase it.

When contacted by the collector, let them know that the statute of limitations has expired for collecting the debt and you do not wish to be contacted regarding the debt again. Send a written notice to the collector that you do not want to be contacted and the Fair Debt Collection Practices Act (FDCPA) prevents the collector from contacting you again. Due to the tenacity of some of these collectors and the stress their collections efforts sometimes cause, you might consider hiring an experienced debt collections attorney to communicate with the companies on your behalf.

Take care of your credit!   

See related: 5 steps to dispute a debt that's not yours, State statutes of limitation for credit card debt, Know your rights: Fair Debt Collection Practices Act

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Updated: 01-18-2018