The length of time a debt is owed is largely unrestricted, unless actions have been taken to relieve people of their debt obligations. There are laws that restrict the legal actions taken against people who haven't paid delinquent debts. However, debt collectors may attempt to skirt those laws in their efforts to recoup the money owed.
Statutes of Limitations
Debt collection in the United States is restricted by statutes of limitations. The statutes restrict the amount of time that creditors and lenders have to sue consumers to recoup a debt. Still, it's important to understand that you're liable for a debt even if the statute of limitations has expired, unless the debt has been forgiven or discharged in a bankruptcy. A debt collector can legally seek payment for a delinquent account even if the debtor can't be sued to recover the money owed.
State Statutes
The statutes of limitations on debts vary from state to state. The state restrictions apply to credit-card debt, written contracts and other forms of debt. For example, a debt collector in Arizona has six years to sue a consumer to recoup a debt specified in a written contract. However, that time limit is reduced to three years for credit-card debt. Your state attorney general's office has information on your particular state's statute of limitations on consumer debts.
Debt Collection Practices
Creditors and lenders have the right to attempt to recoup delinquent debts indefinitely, as long as they don't violate the U.S. Fair Debt Collection Practices Act. Companies that sue or threaten to sue a consumer after the statute of limitations for a debt has expired are violating the act. Even so, creditors and lenders may choose to turn over delinquent debts to collectors to renew efforts to get the money they're owed. Among other things, the Fair Debt Collection Practices Act prohibits collectors from using obscene language to force debtors to pay. Collectors also must stop calling debtors if they receive a written notice from the debtor to cease their contact.
Considerations
Some debt-collection companies may violate the Fair Debt Collection Practices Act and pursue a lawsuit against a debtor even if the statute of limitations has expired. In such cases, it's important for debtors to respond to the lawsuit to prevent collectors from winning court judgments against them. It's up to debtors or their attorneys involved in such cases to point out that the statute of limitations has expired. Debtors who ignore such lawsuits will probably end up paying the entire amount of money sought by the collector involved.
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