Credit Card debt collection timeline

| Apr 22, 2021 | credit card debt |

When New Jersey consumers fall behind on credit card bills, they may get calls from the issuer. The Fair Debt Collection Act prohibits them from abusing the system, but not collecting the debt. There are some laws in place that protect consumers from getting sued by the credit card company.

Statutes of limitation

Each state has a statute of limitation that prohibits the collector from pursuing the debt if they are time-barred. The number of years a collector has to pursue the debt ranges from three to ten years. However, some states still allow the credit card company to contact the debtor after the statute of limitation has passed.

These laws do not include the debts reported to the three major credit bureaus, which may remain on credit reports for seven years. If the debtor makes even a partial payment, it could revive the debt and start the clock over again. Some credit card companies take advantage of the debtor knowing the odds are slim they show in court, so they get a court order to garnish wages.

Consumer rights and time-barred debt

Consumers need proof to ensure the debt is theirs and not someone else’s. Sometimes, collectors get wrong information or records have not been updated to reflect a paid account. A consumer should request validation of the debt in writing, which is required under the Fair Debt Collection Practices Act, and ask for the last payment date.

If the debt collector says they can’t give notice or other information, they could be scammers. If a debtor has doubts about the collection agency, they can check with the Better Business Bureau. A debtor has the options of paying the debt, negotiating with the credit card company, or asking the company to cease contact.

Ignoring collection efforts on credit card debts won’t make them go away. In some cases, contacting a bankruptcy law attorney might be an advisable course of action.