Using the Statue of Limitations to Stop a Debt Collector

Depending on the type of debt, the Statue of Limitations can stop a debt collector from trying to collect the bill. Not all debts are covered under a statue of limitations; child support, educational loans, and taxes have no time limit. All other debts are usually covered within a 3-6 year period however; this depends upon the state you live in.

Just because there are statue of limitations doesn't mean there isn't a loophole to catch you up and bring you back in the target of a debt collector.

Here are the essentials for using the statue of limitations;

• Each state has their own set of rules governing their statue of limitations and how long you will remain responsible for repaying your debt. For example, if you have a car loan and you stop paying in some states after 4 years have passed and you have not made any payments on that car loan then the debt collector can not collect on that loan. *there is a loophole here, so keep reading.

• There are different time periods for each state so be sure to look up your state laws before making any assumptions.

Dealing with the Debt Collector

Believe me, a debt collector already knows the law in your state and here's where the loophole will come into play.

The statue of limitations is only good until you make a promise to pay. That's right; if a debt collector calls you and without knowing your rights, you commit to making a payment, you re-start the statue of limitations.

This loophole has been kind of murky because many consumers and their lawyers argued that in order to re-start the statue of limitations the consumer must make an actual payment and that a verbal promise to pay wasn't really a commitment. This has been tested in court and it has been ruled that a verbal promise to pay re-starts the statue of limitations, re-committing the debtor to the debt.

This is why I say, never ever talk to a debt collector, never give them any of your personal information, never verify any information and never tell them you will *try* and make a payment. You never want the conversation to be misconstrued for a commitment by you.

Debt collectors call you and want to be buddy-buddy and try and help you - no way, they are gaining as much information as possible. Do you have a cell phone you can be reached on? Are you still banking with Bank of America?

And my favorite phase has got to be "Even if you can make a small payment on this account, it will show that you are trying to resolve the issue and work with us."

Yeah right! The debt collector is trying to re-start that statue of limitations to get you back on the hook.

Debt collectors will lie and cheat, even though they know you may no longer be responsible for the debt. That's their job to get the money so consumers must educate themselves.

Many people will say "you created a bill so it's your responsibility to repay it" however laws were passed to give consumers the same advantage as the contractors.

Here's are a few suggestions

• If a debt collection agency calls you and you want to know which agency they are with tell them you do not recollect any such debt - then ask which agency did you say you were with?

• Tell them you will have to research this information because you do not recollect any such debt. Hang up! Now you have the name of the agency in case you need it later.

• If you're simply not interested in knowing any details - I don't suggest you take that attitude - but if you are tired of the calling tell them "I need to let you know that I am recording this call for my records. If you do not wish to be recorded please hang up now." Some debt collection agencies will hang up and some will say No, I do not wish to be recorded, but most will say OK, no problem.

The end result is that you must be smarter than they are. Never talk to them until you know, undeniably, that you are still responsible for that debt.