What Is the Statute of Limitations for Debt by State?

State statutes of limitations for debt vary by state and by the type of debt involved. The statutes don't erase debts that people owe, but they do place limitations on how delinquent debts are collected. Debt collectors who file lawsuits to collect debts after the statute of limitations has expired are violating the U.S. Fair Debt Collection Practices Act.

State Statutes

A state statute of limitations on debt is the amount of time that a creditor or lender has to sue a consumer to recoup delinquent debts. The statutes don't release consumers from paying legitimate debts, but they do prevent wage garnishments and other legal actions creditors and lenders might take to collect debts. Collection companies can still contact consumers to try to recoup delinquent debts even if they can't legally sue to collect them. Consumers generally aren't released from paying their debts unless they're paid in full, discharged in a bankruptcy or forgiven by a creditor or lender.

Credit Cards

Open-ended accounts include credit cards because the credit line and the balance may vary. State statutes of limitations on open-ended accounts can last as long as 10 years as they do in Rhode Island or as little as three years as they do in Alabama, Delaware, Kansas, North Carolina and other states. Bankrate.com lists the timeline for each state's statute on its website. However, you may need to consult with an attorney to determine the statute of limitations on credit cards. Credit card debts usually come with written cardholder agreements, making them written contracts. The statute of limitations on written contracts is longer than it is for open-ended accounts in some states, which may give creditors more time to sue to collect credit card debts.

Contracts

State statutes of limitations on accounts with written contracts range from three years in Maryland and Mississippi to 15 years in Kentucky and Ohio. Oral contracts essentially are loan agreements made with a handshake because no written agreement outlines the terms of the loan. The terms of an oral contract are difficult to prove in court due to the lack of a written agreement. However, the lender has ten years in Louisiana and South Carolina to sue to try to collect money owed on an oral contract. That time limit drops to three years in Arkansas, New Hampshire and Oklahoma.

Promissory Notes

A mortgage is a promissory note. It's different from a written contract because it includes payment dates and interest charges on a loan. State statutes of limitations on promissory notes range from three to 15 years. Bankrate's data on the statutes indicates that Vermont's statute on promissory notes is generally six years. However, it increases to 14 years when borrowers sign promissory notes before a witness.