How to Evaluate the Statute of Limitations on Debt

Step-by-Step Guide

1. 1

   Step 1: Hire a lawyer if you are facing a lawsuit based on an outstanding debt.

   If you have low income, you may be able to apply to have a lawyer appointed with your state's "Modest Means" program or through a non-profit organization.
   
   An attorney is the only person who is allowed to give you legal advice about debt.
2. 2

   Step 2: Find the documents from the debt.

   You should keep track of the original agreement, updates, correspondence from the lender, correspondence from collection agencies and legal documents.
   
   However, even if you have an oral agreement from a debt, you may still be required to pay the debt far after the date of its origin.
   
   You can protect yourself from unfair debt collection practices by keeping a journal of all the attempts made by collection agencies to collect debts.
   
   There are laws in place, such as the Fair Debt Collection Practices Act (FDCPA), to protect debtors from illegal debt collection practices, such as violence and certain types of harassment. , Review the documents and give a copy to your lawyer for review. , Your lawyer can also help you to do this research, if they do not already know the laws. , Each type of debt has a different set of limitations.
   
   For example, in many states an oral debt has a shorter statute of limitations than a written or promissory loan.
   
   In other states, the debt time limit is the same for all classifications. , Your lawyer may be able to make an argument for a shorter statute of limitations, according to living in a different state.
   
   However, the opposing side may try to apply the longest statute of limitations. , The statute of limitations will extend further than the origin of the loan, to the start of the time when you stopped making payments according to the loan agreement. , Even if a debt has exceeded its statute of limitations, failure to appear in court and appeal the lawsuit may result in a judgment against you.
   
   You can use the statute of limitations to get a case dismissed after it's filed. , The IRS has the ability to collect an outstanding debt on taxes up to 10 years from the date of the original tax assessment.
   
   Keep all tax records for 10 years, in case of auditing or lawsuits on the federal level.
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   Step 3: Read the documents to see if they refer to a time limitation for the debt.

4. 4

   Step 4: Search through state government websites to find what the statute of limitations is for your state and that specific type of loan.

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   Step 5: Establish the classification of the debt

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   Step 6: whether written contract

7. 7

   Step 7: oral contract

8. 8

   Step 8: open contract or promissory note.

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   Step 9: Make a record of whether you switched states of residence between starting the debt and defaulting on it.

10. 10

    Step 10: Keep in mind that the age of the debt may start when you defaulted.

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    Step 11: Never ignore legal documents regarding a debt.

12. 12

    Step 12: Review whether the debt is held by the Internal Revenue Service (IRS).

Detailed Guide

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