What is it?



The Statue of Limitation is known as the time limit period that a creditor has in order to file for a federal court lawsuit to request the repay of the whole amount of debt from a debtor.

If the creditor does not file the lawsuit on the stated time, he will lose any chance of doing it at all. No collection agency will have the right to sue you for payment of an old debt. However, if a debt collector tries to force you into paying the debt by threatening to sue you, he can be penalized for violating the Fair Debt Collection Practices Act.

The usual time limit of The Statue of Limitation goes from 3 to 10 years just after the moment you sign any credit contract or after the last written activity on your credit report.

According to a law expert, the Statue of Limitation cases type consider in-person injury from negligence or intended wrong-doing, negligent property damage or intended wrong-doing, breach of written contract, professional malpractice, libel, slander, fraud, trespass, and some other variations."

The Statue of Limitation will guarantee that a debtor cannot and will not be harassed by any collection agency and can not get sued ever again because of this same reason. The time to collect has passed, and the debtor has a chance to defend himself with new evidence. The Statue of Limitation does not assure that a debtor will not be sued, but it will make the judge dismiss the case because of the expired time period.

The Statue of Limitation has exceptions, such as: Federal Student Loans, almost all fines, expired child support among others (depends on the state). The Statute depends on these things:

- The whole amounts of debt owed by you

- The debtor state's civil debt collection code

Statue of Limitation in the USA

Oral Contract: the debtor agrees to pay a loan borrowed by someone else. This contract is known as the “handshake agreement". Verbal contracts are legal but are very difficult to prove in court, because it is your word against another person.

Written Contract: the debtor agrees to pay a loan following the terms of a written contract. Both, debtor and creditor have to sign.

Promissory Note: it is very similar to the written contract. The main difference between these two legal notes is that the scheduled payments and interests on the loan are written down on the promissory note. An example of this is a mortgage where you planned all the payments and you put the quantities in the note.

Open-ended accounts: a revolving line of different credit with a variable balance. For example, credit card accounts.

Statue of Limitations on Judgments

When a creditor needs to file a lawsuit in order to force the debtor to pay, he needs to sue before the statue expires. It is the creditor's obligation to prove the debt is current. After the judgment has gone through, the creditor can take away your assets.

Check these links to learn more:

http://www.bill-consolidation-and-debt-negotiation.com/consumer-credit-counseling/NV-Nevada/Consumer-Credit-Counseling-NV-Nevada.shtml

http://www.bill-consolidation-and-debt-negotiation.com/consumer-credit-counseling/MI-Michigan/Consumer-Credit-Counseling-MI-Michigan.shtml