Different laws apply in each state in terms of the statute of limitations on credit card debt. The range could be anywhere from three years to ten years with a portion of the states maintaining a longer period for the statute of limitations on credit cards. The consumer is protected by the laws that are in effect, not credit card companies. This means the collection of credit card debt is not able to star the process of suing over the debt after the passing of a statute of limitations.
Now, this doesn't mean that you can just ignore your debt. The credit card company can sell your debt to a debt collection agency and they can come after you then. But once the statute of limitations has ended, that credit debt collector cannot sue you for the balance owed.
Debt collection agencies will buy outstanding debts from credit card companies for next to nothing. By selling off the bed debt, the credit card company can try to get back some of the money they lost from the consumer. Then the collection company will come knocking at your door, wanting you to pay the full amount owed. The collection company then keeps all the money you send in since they have bought the debt from the original company.
Because of Fair Debt Collection laws that have been passed, collection agencies are not permitted to harass you, but they are still justified to collect the debt you owe from you. No matter how much time has passed, consumers are still required to pay the debt. If a friends or family were to lend you money, it would still be owed to them regardless of how long it has been since you borrowed it. This same principle applies to credit card debt.
Most people believe that once the statute of limitations has ended that their bad debt will just disappear from their credit report. And this is a complete fallacy. The debt is still on the books, but you cannot be sued by the company that now owns the debt. This is the the only thing the law changes. But you should keep this in mind; since the collection company bought your bad debt for pennies on the dollar, you can settle with them for less money.
About the Author:
Kathy Cromwell a renowned proficient in Credit card debt statute of limitations . Visit this site credit card debt laws.net/ and get more information about it.
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