What Is a Statute of Limitations on Debt?
The statute of limitations on debt is a state law that sets a strict time limit on how long a creditor or debt buyer can sue you to collect an unpaid debt. Once this legal deadline expires, the debt becomes time-barred, meaning the creditor no longer has the legal right to file a lawsuit against you to force payment.
What Is a Statute of Limitations on Debt?
Many consumers are unaware of this protection and assume they must pay simply because a debt collector is contacting them.
“One of the most common misconceptions is that a debt is enforceable simply because a collector is demanding payment,” says consumer attorney Mathew Higbee. “In many cases, the statute of limitations has already expired, and the consumer has more leverage than they realize.”
Understanding whether a debt is still legally collectible can make a major difference in how you respond—and whether a lawsuit is even possible.
How the Statute of Limitations Works
The statute of limitations usually begins when the account first
becomes delinquent. This is often the date of the last payment, but the exact trigger depends on state law and the type of debt involved. Importantly, the charge-off date used by creditors for accounting purposes does not control the statute.
Each state sets its own statutes of limitations, and different types of debt—such as credit cards, medical bills, personal loans, or auto deficiencies—may have different deadlines.
Once the statute of limitations expires, a creditor cannot:
- File a lawsuit to collect the debt
- Obtain a judgment against you
- Garnish wages or levy bank accounts based on that debt
Can the Statute of Limitations Restart?
In many states, the statute of limitations can restart or be extended if a consumer takes certain actions. These actions may include making a partial payment, entering into a payment agreement, acknowledging the debt in writing, or promising to pay.
Because restarting the statute can restore a creditor’s ability to sue, consumers should be cautious before communicating with collectors.
Understanding whether the statute has expired is often the most important step before deciding how to respond to a collection attempt. To see whether your debt may still be within the statute of limitations, check here.