"Time barred debt"

[question everything]

I happened to have the Today Show at the beginning of its third hour. But instead of talking about kids and recipes and fashion, they had their financial mavens answering questions from callers.

Someone reported a collection agency calling about a five year old debt, offering payment of 10 cent on the dollar and it would consider the debt paid in full.

The reply was that this is a "time barred debt" that the time can vary from state to state. Either way, the creditor already wrote the debt off but the collection agency purchased it at, I think, one cent on the dollar.

If that caller was going ahead with the "suggestion" to pay 10% of the debt, the debt would be put back on the caller's credit report.

So, beware of strangers bearing gifts.

[yodoobo]

1. yep..and once you pay 10%

Its *NOT* time barred anymore!

[flvegan]

2. Collection agency needs to prove up its claim.

I wouldn't pay anybody shit if they can't prove the debt is valid beyond a bit of a doubt. AND, they better be able to prove it in court. Good luck with that.

And that's one to grow on.

[question everything]

3. In that example the debt was real, but was more than 5 years old

and as much as most of us want to pay back our debt, the advice was to let it go, that the creditors already wrote it off and that it was no longer in the caller's credit report.

[flvegan]

4. When that collection agency files suit

is the defense going to be that it's time barred? I don't know about your state, but that won't fly here.

[TexasObserver]

5. Many states have a four year statute of limitations on contract breach.

If you have not paid on a credit card in five years, the worst thing you can do is to pay them a dime. You can revive a debt whose statute of limitation has expired with one payment, in any amount. Don't do it. Don't talk to them. Don't respond to them.

[question everything]

6. Indeed. And this was the strong message sent by those

who appeared on the show.

One of them referred to the callers as "vultures."

[TexasObserver]

11. Folks can never get their credit cleaned up if they don't leave those alone.

The company calling paid a penny on the dollar, if that, for the assignment of the rights under the credit card contract.

[Winterblues]

7. Why would you not want to pay an honest debt?

I can understand if someone has had severe financial problems,(medical problems or lost employment) but if it is an honest debt that you took on knowingly, why would you not want to pay your debt when you become able? :shrug: Stealing is stealing........you make a promise to repay someone I believe you need to live up to your word or else you are no better than a thief IMO.

[treestar]

8. There's a statute of limitations

If you are a creditor, you have to file a suit within a certain time period or it will not be do-able.

There's no use in paying for something the creditor can't enforce at law.

It's actually amazing that the creditor did not file.

You aren't a thief. You are simply someone who no longer owes the money. Creditors can't sit on their rights. they have to do something. It's civil, not criminal.

[TexasObserver]

10. I just explained WHY. Because the statute of limitations has passed.

If you are bound by your beliefs to pay it, knock yourself out.

Stealing is your word for it. I suspect you're very judgmental in all things.

I don't care that you think it's wrong. The poster didn't ask for moral lectures but wanted to know what to do about a long lapsed credit account. I have a different philosophy about it than you, but explaining it to you would waste my time and yours.

[pipi_k]

9. And those dirty bastards make the "debt" anything they want it to be

This happened to me in 2005.

The original debt was nearly 20 years old, and probably less than $500. In any case it was written off and disappeared from my credit report after the appropriate number of years.

I get this phone call from a "zombie debt collector" looking to collect nearly $5000! But they would very kindly make it 50% or something like that...

I freaked out and did lots of research on the net. Found out lots on this company, and others like it. They buy up old debt...often uncollectible because the statute of limitations has expired, as it had in my case.

And yes...if you agree to pay anything at all on it, the whole thing goes on your credit report as a delinquent account and will be there for another seven or whatever years!

I contacted Attorneys General in the appropriate states and got those rotten bastards to leave me alone.

NEVER acknowledge a debt without first forcing the company to prove that the debt is valid and that you are the person who owes the money.