Statute of Limitations on Credit Card Debt in Illinois

For every possible case that comes into the court houses of Illinois, there is a statute of limitations established. This prevents the overburdening of the court system with cases that would have otherwise been forgotten. Plaintiffs have limitations on how long to file a lawsuit, and credit card companies are no exception.

Function

The purpose of a statute of limitations is to prevent lawsuits from occurring years after the debt accrued. If credit card companies were free to pursue legal action against a debtor at any time, without limitation, then many individuals would find themselves in court for a debt they thought was long gone. Therefore, state regulations put a limitation on the amount of time that a credit card company, or the collector it hires, can file a lawsuit for an alleged debt.

Time Frame

A credit card account falls under the heading of a written contract with the credit card company because you signed your name to the credit card application, thus agreeing to abide by the credit card agreementa contract. Under Chapter 5, Article 13, Section 206 of the Illinois Compiled Statutes (ILCS 5/13.206), a statute of limitations in the amount of 10 years is set over cases regarding a written contract or evidence of indebtedness in writing, such as credit card statements.

Commencement

Per the Illinois statute of limitations, a credit card company has 10 years to sue you for any alleged unpaid balance on your account. The time frame for this statute of limitations generally begins on the date of the last statement the credit card company sent to you in which they claim you did not make a payment.

Exceptions

You can prove the expiration of the statute of limitations if the credit card company waits until the last minute to file suit. You will need to provide documentation showing that the limitations started earlier than the creditor claims or that you paid the debt in full, including proof that the credit card company received the payment and cashed your check. Additionally, according to ILCS 5/13.206, should you make payment arrangements with the credit card company at any time after establishment of the unpaid debt, then the statute of limitations commences from the date of that payment or promise to pay.

Judgment

When a credit card company files a lawsuit against you within the statute of limitations, the goal is to obtain a judgment against you in order to collect the unpaid debt. This judgment will likely contain the addition of compound interest, attorney's fees and court costs that you will have to pay. A judgment will allow the credit card company to garnish your wages or bank account in order to collect the money.