?'s about when Bankruptsy isn't an option....?

Question

I have about a mid 500 credit score. I know, pretty bad.

I've heard that after 7 - 10 years, if no agreements to make any payments on my part, that things start falling off. The Statute of Limitations for my home state of record is 5-10 years, depending on the type of contract. The S.O.L. for the State I'll be moving to in a few months is much shorter.

Bankruptsy isn't an option, I'm overseas right now. Even then, now you have to make some kind of payment plan with bankruptsy. Well, I'm about 5 years into it all. If I make some kind of payment plan, I'd be restarting those years again.

Anyway, one thing I've noticed is that the creditors re-sell my debt. Do the "years" restart when they do that?

How do I figure out the date by which the "7-10 years" begins from?

Also, because I'm moving back to the States, but not to my home state, which State do I fall under for Statute of Limitations? Home state is where the bills were incurred.

Best answer gets the points

In Bankruptsy, I'd have to take into account my husband's income. He's paying a LARGE amount of child support and we can't afford to pay off my old bills as long as we're losing so much to child support. I currently haven't got a job and am a stay-at-home-mom.

Answer 1

For starters, ignore YSIC's answer as it has a lot of inaccurate info. It's 7 years, period! Not 7 + 180 days....the FTC has issued a staff paper addressing this, but people are still getting confused.

Echo's answer is correct. I posted a link to a site that does a very good job of explaining the SOL laws.

Note one important thing....as Echo states if you leave the country the SOL "tolls" and stops until you return. The rules regarding this are covered under the US UCC laws and not state laws.

When you move from one state to another, the creditor can choose whichever state he wants to use (again under UCC laws). But some states have passed protections against this if their SOL laws have less years.

Answer 2

If you had lived out of the country, be very careful and study the states SOL statutes (for both states) before claiming SOL.

Some states SOL's toll (stop running) when you leave the country. When you return the SOL will then pick up and continue to run from where it had stopped.
(For example, you have a 5 year SOL and you leave the country after 2 1/2 years pass.
The SOL stops running.
You return 3 years later, the SOL starts to run again and continues to run for the next 2 1/2 years)

Also there are a few states that will allow a debtor protection under the shorter SOL of that particular state versus the longer SOL from the previous state.


I can't stress enough that you should become familiar with both states SOL statutes, especially since you have lived outside of the country for awhile.



Without knowing what type of debts you are talking about, or if your state SOL tolls if you leave the country, I'll list a few SOL start dates --

For credit cards, the collecting SOL starts to run from the first time you became 30 days late and never brought the account current leading to the charge off. Credit cards would be open accounts.
For bank loans it is from the last payment. (written accounts)
For medical it is from the date of service. (possible open, possible no SOL if the medical provider receives federal or state funding)
For repo's it is from the date the repo was sold that created the deficiency. A repo voids the original contract and because of that they fall under the UCC for a 4 year SOL.
For utilities it is from the last payment (generally under the UCC for 4 years, possible under sale of goods)

The reporting period starts at the times mentioned above and is 7 years -- and NOT 7 years + 180 days as people mistakenly believe (per FTC Staff Opinion Letters)


Generally the creditor/collector can chose which state to file suit. Though you can always have it moved to the state where you have set up residence.

Answer 3

First to answer your general question. Creditors are not allowed to Re-Age debts when they sell them. All of the counters start from the date of the original delinquency. They can be reset if you make a payment after that, but if you have not it is still the original date. They will remain on there for 7 years from this date. The only exception to this is Bankruptcies which do remain for 10 years or any Tax leins that don't go away until they are paid.

As for bankruptcy if that is an option, they not only look at Income, but also expenses. Since Child Support is an debt that has to be paid it can be taken off of his income so you might qualify.

I believe that the SOL applies to the state you signed the contract in orginally. However, if you do move to another state you would have to gain residency in that state. This can be anywhere from 6 months to 1 year. After that time the SOL for that state should apply.

Answer 4

First, be aware that even though debts fall off your credit report, that does NOT mean that you don't owe the debt anymore. The creditors still legally have the right to try and collect the money you owe.
Adverse accounts will fall off your report 7 years after the date of delinquency. Be advised that the date of delinquency usually falls 180 days after the payment is due....so if you were late for a January payment, they may not turn you over to collections until 180 days after that, which is July. So, on your report, the actual fall-off date will not be until 7 years and 6 months after the date of delinquency.
It is illegal for collections agencies to re-age your accounts no matter what.
Your SOL is based on the state in which the debt occurred.
I hope that helps!

Answer 5

I don't know US law but in the UK the debts won't go away if the creditor has obtained a court judgement. The Statute of Limitations only applies if the creditor has not actively chased the debt.

The "7-10 years" (6 years in the UK) would re-start here if you admitted the debt.

Again if the debt was in the UK, I'd advise you to consider returning here, declaring bky and then going back abroad.

Sorry I don't enough about US law but others may have a perspective.