You hear a great deal about Statute of Limitations but what exactly is it and how does it apply to you? In essence, the Statute of Limitations (as far as debt is concerned) is the amount of time a creditor has to sue you. Each state has its own time frame for a Statute of Limitation. (See references below.)
The Law.com dictionary offers of very clear and accurate definition and description of Statue of Limitations (SOL) A segment of that description follows:
“a law which sets the maximum period which one can wait before filing a lawsuit, depending on the type of case or claim. The periods vary by state. Federal statutes set the limitations for suits filed in federal courts. If the lawsuit or claim is not filed before the statutory deadline, the right to sue or make a claim is forever dead (barred).
“The limitations (depending on the state) generally range from 1 to 6 years except for in Rhode Island, which uses 10 years for several causes of action. Louisiana has the strictest limitations, cutting off lawsuit rights at one year for almost all types of cases except contracts. California also has short periods, usually one year, with two years for most property damage and oral contracts and four years for written contracts.
“There are also statutes of limitations to enforce a judgment, ranging from five to 25 years, depending on the state. Some states have special requirements before a lawsuit can be filed, such as a written warning to a physician in a claim of malpractice, making a demand upon a state agency and then waiting for the claim to be denied or ignored for a particular period, first demanding a retraction before filing a libel suit, and other variations. Vermont protects its ski resorts by allowing only one year for filing a lawsuit for injuries suffered in a skiing accident as an exception to that state’s three-year statute of limitations for other personal injuries.” Law.com Dictionary
Debt SOL- To determine the debt Statute of Limitation (SOL) for your particular state, I recommend visiting one of the following.
Fair Debt Collection.com
When Does The Clock Starts? – according to Nolo Press:
“In most situations the time starts to run on the ‘date of harm.’ However, a huge exception to this general rule exists. The exception protects plaintiffs in situations where they may not be aware for months or even years that they have been harmed. In such situations, statutes of limitations may begin the clock ticking either on the ‘date of discovery’ of the harm, or on the date on which the plaintiff ‘should have discovered’ the harm.”
With reference to Statute of Limitations in general with regards to military personnel, Military.com states: “A member’s time in service cannot be used to compute the time limits for bringing any action or proceeding by or against a member, whether in court or elsewhere.”
Warning from Fair Debt Collection
A WARNING! Page from Fair Debt Collection offers this critically important caveat within its pages.
“While the statute of limitations is running or even after it’s expired, making ANY payment or signing a promissory note can reset or restart (depends on your state law) the statute of limitations. Always check if the SOL has expired BEFORE making a payment, signing an agreement to make payments or even acknowledging the debt is valid.”
I would add this second caveat to avoid confusion. If a Statute of Limitations is 4 years, this does not mean a report cannot be filed on your credit report which lasts 7.5 years. SOL and credit reports have two different time schedules and should not be confused.