Three Time Periods For Collectors To Collect Debts

Three Time Periods For Collectors To Collect Debts.

collectAlabama consumers often ask “How long can the collection agency collect against me and what is the Statute of Limitations on credit reporting and suing?”

This question actually touches on three separate time limits.

First, a collector generally has three to six years to sue you. This is the statute of limitations.

Also, to be precise, a collection agency must actually own the debt to sue you.

Second, a collector can report a negative item on your credit report for generally 7 years after the first major delinquency.

Finally, a debt collector can generally collect for an unlimited time but the collector cannot sue (or threaten to sue) if the statute of limitations has expired.

The bill collector cannot credit report (or threaten to credit report) if the seven year time period for credit reporting has expired.

And the collector must tell you that if you make a payment, you may restart the statute of limitations.

Let’s look at these in more detail.

Debt collector has 3-6 years to sue you on a debt

We won’t get into all the arguments about whether for credit card debt it is 3 or 6 years.

For most car loans, it is 4 years from when the entire debt is due (usually right before or after repossession).

The bottom line is there is a period of time to sue you.

If the debt collector waits too long to sue, then it is illegal under the FDCPA (Fair Debt Collection Practices Act) to sue you.

And you would also have a valid defense to the lawsuit as a solid statute of limitations defense should win you the lawsuit.

But often the time limit to sue and the time limit to credit report get merged so let’s talk about that next….

Credit reporting can only happen for 7 years after your first major delinquency with the account

Positive credit reporting can stay on your report indefinitely and that’s fine — it is positive after all!

But what about negative?

“If the time limit to sue (statute of limitations) is up, doesn’t the credit reporting have to go away?”


These are two completely unrelated time periods.

Here’s the deal on credit reporting.

We look at the first major delinquency which is normally six months without paying.

That marks our spot on a time line.

And then you go forward 7 years.

At the end of the 7 years, the credit reporting must be deleted.

This is true whether the statute of limitations is 3 years or 33 years.

It doesn’t matter.

Credit reporting time limits are not affected by a state statute of limitations.

But what about a debt that is too old to sue and too old to credit report, can a collector still collect against you?

Well . . . maybe . . . if the collector is very careful.

Most aren’t.

Any debt collector that is collecting after the statute of limitations or after the time period to report needs to be very clear about what it can and cannot do to you

The debt collector can’t threaten to sue you.

Can’t threaten to credit report.

Can’t say, “We might sue you” or “We might credit report.”

There is no “might” about it — it is illegal to do so and therefore it is illegal to threaten you.

And the collector needs to tell you that the debt is “out of statute” meaning you can’t be sued for it.

Since collectors often claim that if you make a single payment you restart the statute of limitations, you need to be told this by the debt collector.

They disagree and of course don’t tell you.

Then when they get sued they complain about the unfairness of being sued.

However, the truth of the matter is collecting on ancient debt is a minefield and collectors simply don’t want to be bothered to step carefully through this.

Contact us.

If you live in the state of Alabama and you have any questions, give us a call at 1-205-879-2447.

Or you can fill out a contact form and we will get in touch with you as soon as possible.

We will be glad to help you in any way we can.

I look forward to chatting with you!

Have a great day.

-John G. Watts



  1. Kathy T says:

    I was contacted by a “locator, Steven Walker” giving me the number to a company called Globa lto pay them to stop this guy from serving me with criminal charges /he said I had a payday loan and whhen they went to collect bacl in 2008 it did not clesr my account. I have a stroke and do not remember any of this; however: I would have never written a biunced check as I worked for the government with a seurity clearance.. They wanted to extort money from me by saying they were going to press criminal charges if I sid not pay up, I called the attorney General’s office and they said it was a scam. At any rate their scare tactics do scare. ?Just wanted to share my story that was 4 weeks ago, have not heard from them again. /they also said it would cost $200 to see what they are serving me for? I live in MS and service here is $25 they hire this extortion threatening locator for $200.Kathy

    • JohnGWatts says:

      Lots of scams that sound very similar to this Kathy.

      These guys like to threaten and make crazy claims but generally they go away when they are scammers.

      I’m glad you didn’t pay but instead contacted the Attorney General’s office to get some guidance.

      Keep us posted and best wishes!

      John Watts
      Birmingham, Alabama

  2. Kathy T- typing says:

    I apologize for my typing I lost half my vision due to my stroke.

    Kathy T.

  3. Chuck says:

    I had a debt were I signed a contract for a credit card machine, according to the date on the contract, the first payment was to be 3/5/2001. This was a 4 year payment agreement. This I later found out, since I didn’t realize some of the tactics taken, was a non-cancelable lease agreement with one company. I cancelled with the Bank that the transaction were going through after the first statement when I realized the representatives had lied about the fees and charges. I could not get out of the lease though. I tried as I paid the first 4 or 5 payments and my business failed. I later returned the machine to the company thinking it would help but they wanted their money. It stayed on my credit for the 6 or 7 years and then came off. Since then Push Pin Holdings has acquired the debt and sent me a letter that I wish I could find now because it said they were going to seek legal action if I did not start paying for the debt. After contacting the Attorney General they said I had no recourse and they tried to mediate with the company with no help. I am now trying to find out if after 13 years from signing and 8 years from the end of the original contracts final payment if they can sue me now?

    • John Watts says:

      Sorry you are dealing with this.

      Sounds like a business type debt so the FDCPA (Fair Debt Collection Practices Act) will normally not apply.

      You still have rights, however, so I would try to find the letter where they threaten legal action. Is this collection agency calling you?

      The Attorney General’s office isn’t able to help on things like this in my experience but it was smart to contact them to find out.

      I don’t think this company can sue you but there are a few questions we would need to go over to make sure.

      If you live in Alabama give us a call at 205-879-2447 and Carolyn will set up a meeting or call for us.


      John Watts

  4. Elli C says:

    Is it legal for a collector to sue if the judge makes a note that the collection “seems to be time-barred” and you were not notified of the trial date. The judge let it go and a judgment was brought. Are the garnishments legal if the employer doesn’t tell you that you are being garnished and no garnishment paperwork was sent? Thank you.

    • John Watts says:


      In Alabama, there is a limited amount of time you can wait before challenging a judgment or else it becomes too late.

      Just because a lawsuit is “time-barred” (brought after the statute of limitations expires) does not mean the judgment is invalid. It may be improper to sue you and you might could sue the collector under the FDCPA (Fair Debt Collection Practices Act) but the judgment can still be valid.

      So missing the trial date needs to brought to the judge’s attention ASAP.

      On garnishment, you should have received a copy of the notice of garnishment. Your employer normally does not have to tell you — although almost all do — but you are supposed to get a notice from the other side (the collector).

      Sounds like you need to get with a consumer protection lawyer ASAP as there are strict time limits in place — make sure and get with someone in your state immediately.

      Best wishes

      John Watts
      Alabama — 205-879-2447

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