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Statute Of Limitations On Debt

Statute Of Limitations On Debt

: Richard West Law Office

limitationYou may have heard the old advice to stop paying your debts because they eventually become uncollectible. Well, this statement is entirely false, but purposely defaulting on debt is not a smart debt relief strategy. Here is why:

Variable Time Lines

Debts are time-barred, meaning that there is a window of time that you can be sued for payment of your debt. The tricky part is that different types of debt carry different time frames, and each state also rules on how long a debt is considered eligible for lawsuit over repayment. In Ohio, the statute of limitations is 6 years for credit card debt. This means that you cannot be sued for any credit card debt older than 6 years. While this may sound like it works in your favor, it can also hurt you. Not paying debts puts you at risk of credit damage, subject to repossession or other collection actions, and of course lawsuits. Even if you can prove that your debt is uncollectible in court because it exceeds the statute of limitations you are still facing the consequences of non-payment like severe credit damage and the inability to borrow again for a long time.

Preferable Alternatives

The biggest reason that purposely defaulting on a debt is a bad idea is that there are better solutions for managing your debts. Sure ignoring the debt until it goes away seems like the easier option, but it often results in far greater hassle than dealing with your debt in another way. If you cannot afford to repay your credit card debt you can try to negotiate payment terms with your account holder. Many will reduce interest rates or accept a settlement offer if they feel the debt is at risk of non-payment, but this takes time and effort on your part. Another option is to discharge your credit card debt in bankruptcy. Filing for bankruptcy in Dayton OH can offer you court approved elimination of your debt, and the best part is that debt collectors will be permanently barred from collecting on the debt in the future.