Ohio Laws on Credit Card Debts

Credit card debt can escalate quickly when a consumer starts being charged interest and penalties. When someone uses cards then does not pay the credit card company, the original amount of debt grows fast.

Statute Of Limitations

The state of Ohio has a statute of limitations for collecting debt via a lawsuit. A credit card account is regarded as an open account, and the statute of limitations for open accounts in Ohio is six years. A person who owes credit card debt may not be legally obligated to pay it if the statute of limitations is past six years. This is referred to as a time-barred debt. The statute of limitations begins when the credit card debt has defaulted for 180 days. Debt collectors may try to collect time-barred debts, but they cannot sue for them. However, a request to pay the debt after the statute of limitations has expired is legal.

Re-Aging Debt

If the statute of limitations has expired and an individual makes a payment, however small, to the credit card company or collection agency, then the statute of limitations is automatically reset. This is referred to as re-aging the debt, which makes the old debt collectible. The old debt may also extend the time limit on potential debt collection lawsuits. This means the person can be sued for the amount owed. A creditor may sue for a credit card debt that is beyond the statute of limitations for Ohio. The debtor has to prove to the court that the statute of limitations on the debt has expired.

Court Rulings

State court rulings may take precedence and make the statute of limitations for consumer contracts or debts earlier or later than state law. A court ruling in Ohio can increase or decrease the six year statute of limitations of Ohio. For example if a court in the state sets the open-ended accounts limit for eight years, then a creditor files a lawsuit against a debtor in Ohio, the statute of limitations used would be the eight-year statute of limitations rather than the six-year one. Federal law governs how and when debt collectors can contact consumers and collect on unpaid bills and dictates where legal action on debts can be filed. According to Section 811, debt collectors may file suit only in the jurisdiction where the "consumer signed the contract" or where the consumer lives.