How to Negotiate With Creditors Without Restarting the Statute of Limitations

When the statute of limitations on your debts has passed creditors cannot win a lawsuit against you in a court of law. If you show up in court, on the trial date, and provide proof that the statute of limitations has passed, the court will rule in your favor. The time frame for the statute of limitations will vary from state to state. Usually the statute of limitations starts when you make your last payment. Sometimes when you negotiate with creditors the statute of limitations can restart.

Instructions

1

Check with the statute laws in your state. Each state has their own rules and regulations concerning the statute of limitations. In some states the statute of limitations can be restarted just by acknowledging that you owe a debt. The statute can be restarted, in other states, if you write out a written agreement for new terms and agreements. Agreeing to a new long-term agreement can also restart the statute in some states. A partial payment may or may not restart the statute depending on your state. Find out all of the facts concerning the statute of limitations before you make any arrangements for repayment of debts.

2

Determine time frame for the statute of limitations. The statute of limitations has a beginning and an ending. This will vary from state to state. If you owe a debt chances are it's an oral, written, promissory or open-ended account. The time frame for the statute of limitations for each type of account varies by state. The least amount of time is two years and the maximum time is 15 years. Kentucky and Ohio have statute of limitations for 15 years for written contracts and promissory notes.

3

Make arrangements for payment without a written agreement. A new written agreement in place appears to be the primary method for restarting the statute. Your state laws will determine what's in affect for you. According to the Creditinfocenter.com the statute of limitations is extended or restarted if you have a new written agreement in place with a creditor, in the following states: Arizona, California, Florida, Iowa, Kansas, Maine, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nevada, New York, Texas, Virginia, West Virginia and Wisconsin. When you negotiate with your creditors make sure none of your other actions restart the statute.