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Debt Collection Laws: Statue Of Limitations Explained
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Debt Collection Laws: Statue Of Limitations Explained

Many debtors facing credit card debt lawsuits are largely unfamiliar with debt collection laws in their state, which is unfortunate since one can build his or her defense and quite possibly, win the lawsuit if he or she takes time to review their states' local debt collection laws.

One such debt collection laws include the Statute of Limitations. Statute of limitations refers to the period where a debtor cannot be sued for a certain debt because it is time-barred. Usually, the statute countdown starts from the last time you made a payment on your credit card account. Known as DOLA or date of last payment, this could be anything from a partial payment or any kind of payment made on a credit card to the original creditor or even a collection agency.

For example, say, the last time you paid your credit card balance was in June 2006 and in your state, the limitations for all open-ended accounts is six years.This means that the credit card debt will be out of statutes by June of 2012.

Now, this doesn't mean the creditor will stop its collection efforts by June of 2012. It means your creditor can no longer sue you for the said debt after June 2012. If your creditor stopped suing you for the debt yet remains active in calling you or the people around you to collect the debt, you can put a stop to this by filing a Cease and Desist letter.

For many debt collecting agencies, the minor details are often overlooked and very few debtors take a chance to review debt collection laws to defend themselves. Note that each state has their own statutes on debts and to know more about statute of limitations in your state, you can reach your State's Attorney General's office and know more. A simple search online is also a great way to obtain all the information you need about debt collection laws.

So in order to increase the chances of the credit card lawsuit being dropped by your creditor, make sure you educate yourself about the kind of legal process that will take place once the lawsuit reaches the court. This is important even if you have no plans to represent yourself Pro Se. Being informed about how things will play out in court will help you be two steps ahead of your creditor and get them to think twice about letting the credit card lawsuit reach the court instead of settling the debt out of court. If your creditor sees that you know exactly what you are doing, they may become more open about settling the debt rather than battling it out in court.


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