In this blog, we will cover and discuss the statute of limitations on debt and judgments. Thousands of hard-working people do go through periods of hard financial times. They lose their jobs, get demoted, or the company they work for shuts down or goes out of business. Unfortunately, the outcome of financial hardships often leads where people cannot pay their debts on time. Many get behind on credit obligations. When the financial situation does not improve, many credit accounts go into default and into collections.
What is the Statute of Limitations on Debt
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The statute of limitations on debt is the deadline for a creditor to take legal action to get their money back. Once this time is up, they can’t sue you anymore, but they might still try to collect by reaching out to you or reporting the debt to credit agencies.
Certain situations can pause or “toll” the statute of limitations, giving creditors more time to collect.
The time limit for how long you can be sued over a debt varies based on what kind of debt it is and the rules in the state or country where it originated. In the U.S., this limit usually falls between three to ten years for most types of debt, like credit card bills, medical bills, and personal loans.
Worried About Debt or Judgments? Know the Statute of Limitations
Understand how the statute of limitations affects your debt and what you can do to resolve it.
Filing Bankruptcy Versus Waiting Out Statute of Limitations on Debt
Many people have old debts they haven’t paid and are considering filing for bankruptcy. However, they might not need to if their debts are really old. That’s because there’s a time limit, called the statute of limitations, which is like a countdown where creditors can try to collect the debt. Once that time is up, they generally can’t take any action to collect it anymore.
How Collection Agencies Collect Outstanding Debts
Individuals should consult with a legal professional or refer to the specific laws in their jurisdiction to determine the statute of limitations for their debts. Additionally, remember that the statute of limitations does not extinguish the debt itself; it only limits the creditor’s ability to enforce it through the court system. Debt collectors can use whatever means allowed by law such as the following:
- Sending demanding letters
- Calling
- Filing a lawsuit
- Getting a deficiency judgment issued in court
Once the statute of limitations expires consumers are no longer obligated to pay the old debt. In a sense, it is an expiration period for uncollected debt. Before deciding to pay an old debt or judgment, make sure that the statute of limitations on a debt has not expired. If the statute of limitations on a debt has expired, consumers are not obligated to pay the debt.
Credit Reports
Statute of limitations period on old debt is different than the derogatory credit reporting period. By law, the three credit reporting agencies:
- Transunion
- Experian
- Equifax can only report derogatory credit for a period of 7 years from the date of the last activity
Statute of Limitations on Debt: How Long Do Derogatory Tradelines Stay on Credit Reports
They only report derogatory credit for a period of 7 years from the date of the last activity. However, the statute of limitations on old debt varies from state to state. If the statute of limitations on a delinquent debt expires in 5 years from the date of last activity, the credit reporting agencies can still report it for another 2 years. After 7 years from the date of last activity needs to fall off from all of three credit reporting agencies.
If the statute of limitations is 10 years for an old written debt, the credit reporting agencies need to remove it from the credit report after 7 years from the date of last activity.
But the creditor and/or debt collector still has 3 years to go after deletion from the credit report to collect on their delinquent debt. Most bad debt can only remain for 7 years from the date of the last activity. The exception is Chapter 7 bankruptcy.
How Long Do Bankruptcy and Tax-Liens Be Reported on Credit Reports
Chapter 7 bankruptcies stay on your record for 10 years after being discharged. Chapter 13 bankruptcies remain for 7 years. Tax liens can be on your record for up to 15 years from the date they are issued. Judgments are reported for 7 years from the date they are awarded. The Fair Credit Reporting Act (FCRA) explains how long different types of information can be reported. The FCRA does not influence the duration you have to settle a debt.
Do You Know the Statute of Limitations on Your Debt or Judgment?
Learn the time limits on debt collections and how it impacts your financial future.
Mechanics on Statute of Limitations on Debt
If you have debts or judgments, knowing your rights related to the statute of limitations is important. The time limit for legal action begins from the date of the most recent activity on your credit account. This date is known as DLA, which is the date it was last reported as late on your credit report. The three credit reporting agencies show this DLA on their reports. This date begins the countdown for the statute of limitations.
If you make a payment on an older debt, the statute of limitations restarts. Even a small fee, like $5, can reactivate the DLA, and the countdown starts over. Therefore, it’s best not to pay or contact old debt collectors or creditors and to let the statute of limitations period run out.
Note on Statute of Limitations on Debt
Please note that not all debt collectors will stop their debt collection activities just because the statute of limitations period has expired. Debt collectors are ruthless and will try to get consumers to pay. They will still try to collect on debts that they know the SOL period has expired. Consumers need to tell them they are aware of their rights and that the statute of limitations period has expired. Every state has its own statute of the limitations expiration period.
Debts Exempt From Statute of Limitations on Debt
Not all debts are off the hook when it comes to the statute of limitations. State and federal income taxes are included in these rules, so they don’t get a pass. Even government loans, like federal student loans, don’t have an exemption. In most states, things like child support and alimony payments aren’t exempt either. On the flip side, some debts don’t have a statute of limitations. This includes federal student loans, child support in certain states, and income taxes. So, if it comes to a lawsuit over any of these debts, consumers can’t use the statute of limitations as a defense.
Statute of Limitations on Debt, Judgments, and Tax Liens
Mortgage borrowers can still get home loans even if they have outstanding judgments or tax liens. However, they need a written payment agreement with the creditor or the IRS. They must have made three months of payments and provide the lender with three months of canceled checks or bank statements as proof. The statute of limitations for judgments varies by state, but most states have a 10-year limit. Judgment creditors can renew the judgment once this period expires.
Qualifying For Home Loans With Bad Credit With Lender With No Overlays
Borrowers do not have to pay outstanding collections and charge off accounts to qualify for home loans. Many borrowers believe that outstanding collections, charge offs, judgments, and tax liens need to be paid in full to qualify for mortgage loans. Home Buyers and Homeowners who need to qualify for a mortgage with a mortgage company licensed in multiple states with no lender overlays can contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com.
Gustan Cho Associates has a national reputation of being a one-stop mortgage shop. We have relationships with dozens of non-QM and alternative wholesale lending partners. Over 80% of our borrowers are folks who could not qualify at other lenders due to their lender overlays or them not offering the right mortgage loan program. The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays.
How Long Can Creditors Pursue Debt and Judgments?
Understand the time limits and how to protect yourself from collections and judgments.
Frequently Asked Questions About Statute of Limitations on Debt:
1Q: What does “Statute of Limitations on Debt” Mean?
A: The statute of limitations on debt is the legal time limit a creditor has to sue you to collect a debt. Once this time is up, they can’t take you to court over it anymore.
Q: Does the Statute of Limitations on Debt Mean I Don’t Owe the Money Anymore?
A: No, the debt still exists. The statute of limitations on debt just means the creditor can’t sue you to make you pay. They can still call or send letters.
Q: How Long is the Statute of Limitations on Debt?
A: It depends on your state and the type of debt. In most states, the statute of limitations on debt lasts between 3 and 10 years from the last payment or account activity.
Q: Can Debt Collectors Still Contact Me After the Statute of Limitations on Debt Expires?
A: Yes. Even after the statute of limitations on debt expires, debt collectors can still try to get you to pay. But they can’t take you to court if the time limit has passed.
Q: What Happens if I Make a Payment on an Old Debt?
A: If you make any payment—even a small one—it can restart the statute of limitations on debt. This gives the creditor more time to sue you.
Q: Is the Credit Reporting Time the Same as the Statute of Limitations on Debt?
A: No. The statute of limitations on debt is about how long you can be sued. Credit reporting time is about how long the debt shows up on your credit report, which is usually 7 years.
Q: Are There Debts Not Covered by the Statute of Limitations on Debt?
A: Yes. Some debts like federal student loans, child support (in most states), and taxes don’t have a statute of limitations. You can still be sued for these at any time.
Q: Should I Pay an Old Debt if the Statute of Limitations on Debt has Passed?
A: It depends. If the statute of limitations on debt has expired, you are not legally required to pay it, and paying may restart the clock. Talk to a lawyer before making any payment.
Q: Can I Still Get a Mortgage if I have Debts Past the Statute of Limitations?
A: Yes. At Gustan Cho Associates, we help people get approved even with old collections or judgments—especially if the statute of limitations on debt has expired.
Q: How Can I Find Out if the Statute of Limitations on Debt has Expired?
A: Check your credit report for the last date of activity and look up your state’s time limit for that type of debt. Or talk to a lawyer who can help you figure it out.
This blog about “Statute of Limitations on Debt and Judgments” was updated on July 23rd, 2025.
Statute of Limitations on Debt and Judgments: What You Need to Know
Discover your rights and what creditors can or cannot do once the statute of limitations has passed.
Hi:I live in Florida. AmEx had a judgement against me in 2018. They didn’t pursue the judgment then wrote-off the debt just last month. Now a new debt collector says they bought the debt. Can the new debt collector move on the AmEx judgment, or do they have to go to take me to court? And if so how does the SOL play out? My last payment was in 2014.Thanks,Joe T
Statute of limitations are normally 10 to 20 years depending on the state. I think in Florida, it may be 20 years. The judgment creditor has the option to renew the judgment after it runs its statute of limitations for another 20 years. If you were issued a judgment, that judgment can be sold and the owner of the judgment can just let it sit and/or try to enforce the judgment. You cannot qualify for any mortgage with an outstanding judgment. You either need to pay the outstanding judgment and/or enter into a written payment agreement. Feel free to contact us at 272-716-8151 or text us for a faster response. Or email us at gcho@gustancho.com.