Is it true that your debts get wiped?

Question

I heard if you have debts but the people you owe can't find you they will be wiped after so many years. Is this true? or is it only wishfull thinking?

Well its been over six years now and fingers really crossed i havent heard from them yet, but my credit rating is really bad. I would like to pay it off but i cant even remember who i owe and how much?

Answer 1

They will find you...

When I was living at home/going to college, I had a credit card that my mom was paying for me, I only used it for gas and in case of emergency. Well there was like a $150 balance. Well I never saw a bill, she said she took care of it all. Well I moved out of that house, moved somewhere else, got married, changed my name, and moved again..And they still found me 5 years later with a $2000 bill... Imagine my suprise

Answer 2

Many answers are mixing laws they don't fully understand. In the US, the Federal Fair Credit Reporting Act, requires accounts be removed from your credit report 7 years after the initial default. This has NOTHING to do with owing the debt or the creditors ability to collect. Each state has a Statute of Limitations that limits the time in which the creditor can SUE to collect debts. If they make a legitimate effort to contact you and fail, the court may issue a 'default judgment'. That basically means the court rules you lose the case because you can't be found. Once a judgment is secured, the statute of limitations no longer applies. Judgments may or may not expire after a set time, but are often renewable. Even if the Statute of Limitations bars a creditor from using the courts to collect, your debt still exists and they can ALWAYS ask you to pay. If you ever wish to do business with the company, or any company they own in the future, they can require you to pay before doing business with them.

Answer 3

Each state has a statue of limitations, and a debt can no longer legally be collected after that time. That doesn't mean debt collectors can't still bug you, but they cannot sue you, garnish wages etc. If debt collectors do contact you, you can tell them the statue of limitations has passed, but you must do it in writing, and chances are they will just resell the debt to another collector-something which is legal. The only time they truly "disappear" is when they are either paid off, or fall off your credit report after 7 years. One word of caution to you-you mentioned you wanted to start paying these debts, which you can probably find by pulling your credit report, but ANY contact you make to a creditor is going to start the clock ticking again-in other words, if you are two weeks ago from the statue of limitations running out, and you make a payment or payment arrangement, you are on the hook all over again for another 6 years, or whatever your state statue is. For great advice about this, I highly recommend looking up Liz Pullium, she writes a column about just this type of stuff.

Answer 4

Wishfull thinking mostly.

It depends on who you ave borrowed from.
Look at your friends, family and collegues for an example, borrow £10 from your dad and after a week he might 'forget' you owe him. £10 from your brother and he might 'forget' after a year (well, my brothers do eventually forget), and from a collegue at work - they might ask you every day for the money back for as long as they can. Its the same with organisations that lend you money. Banks MIGHT write off the debt and cancel it after say 10 year, however a student loan wont get cancelled untill you are 65.

It depends on the organisation and I wouldnt suggest that running away will help you out - they can find you as soon as you apply for debt, or bank accounts or credit cards in a new area and then it will be worse because they will add interest to what you owe, and possibly debt collectors fees, and of course will damage you credit (debt) rating.

Answer 5

It depends on how long the statute of limitations is for each claim that the debt is based on, and also whether or not they have obtained a judgment for the debt. But the answer is yes, if you owe somebody money and they haven't bothered to sue on it for a number of years, you would be able to defend any lawsuit by asserting that the claim is barred by the statute of limitations. That doesn't mean the debt is wiped out. It just means you might have a defense.

Answer 6

Well, there is a statute of limitations in the UK and debts can become uncollectable.

The usual period is six years but this is extended for some debts. Twelve years in the case of mortgage debt.

The problem is that during the six year period the debtor has to have made no request for repayment. If you have moved and not told them then you may be deemed to have deliberately avoided them and the six years will start again when they find you.

If you kept them informed of your whereabouts and they did nothing about collecting the debt then it is their hard luck.

Answer 7

i'm a CPA, and that i've got seen a pair issues that bend the final rule. some places like the Federal pupil very own loan application, will re-classify an older college very own loan, ending in "A", and contact it "B". no longer basically has the older debt been renewed yet another 7 years, it now includes activity and penalty. I additionally had a consumer that had many smaller medical charges on her rfile. I entreated her to pay them, some by way of a set employer... would not you be attentive to it - yet another series employer smelled blood interior the water, and tried to collect bills on a furnishings very own loan - that became into older than 7 years and not even on the Equifax rfile! long tale short, pay what you could, esp. if a small quantity advantages its very own row or itemizing. the only confident thank you to make stuff flow away is via paying, no longer waiting for lenders to renounce!

Answer 8

Wishful thinking, unfortunately, because whomever you owe, will turn the debt over to the credit bureau and your credit will suck no matter where you go. There may be a seven year thing, where after seven years it goes off your credit score, I am not really sure about that, but seven years is a long, long time not to have credit.

Answer 9

Why would you wish to steal from others?

Those people you owe money to have families and debts of their own. You should do the right thing and pay your debts.

Answer 10

Your debts will never be wiped. You may get away with not paying them, but your unpaid debts will haunt your brain for the rest of your life until you pay them. Dishonesty will cause you to lose your self-respect. If I were you, I would pay every thing I owe. I'd hate to look at myself in the mirror otherwise.