Did you know what debts can expire? Under Minnesota’s laws, most consumer debt has a statute of limitations of just six years. That means that creditors cannot sue you for the debt unless they take action within six years from the last time an account was used or a payment was made.
That won’t stop creditors from crawling out of the “debt graveyard,” however, and trying to collect again. There’s an entire industry that has been built up around “zombie” debts – and such debt collectors are not shy about trying to force people to pay them.
Old debts are bought in bulk, and collectors try to scare people into paying
Generally speaking, zombie debts start becoming a problem for consumers when these old debts are sold for pennies on the dollar by the original creditor. The consumer then receives calls and letters from the new creditor, along with threats of legal action. In some cases, the debt is suddenly even placed back on the consumer’s credit report, lowering their credit score.
To avoid falling into a trap it is critically important to never acknowledge responsibility for the debt when speaking with these third-party collectors – and never make a payment. If you make a payment, you re-start the six-year statute of limitations and allow them to press their claim.
If you’re suffering from creditor harassment, don’t let yourself be bullied. Seeking legal guidance can help you better understand your options under the Fair Debt Collection Practices Act (FDCPA) and protect your interests against illegal or unfair creditor tactics.
