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I need some knowledgable advice on debt management. I am looking to repair my financial past but first want to educate myself before going forward. I have come across the Statute of Limitations on Debts and am wanting more info. Basically I am concerned with something in particular on my credit report. It is a $ 200 bill for a movie rental. It says that it will be removed 12/2009. Obviously I would rather work something out and not pay the $ 200 for the video. Any advice? I have lived in IL and MO and the time frame for this Statute of Limitations seems to be the same. Any other helpful advice for negotiating my debt so I can be debt free in 2009?

5 Thoughts on Statute of Limitations on Debts?
  1. Reply
    stan c
    June 21, 2011 at 11:23 pm

    In most states, the Sol is 4 years which means they can not sue in court. It comes off in most cases in 7 years. However, they can call you until the day you die to collect the money. They may sell it to a collections agency for about $ 20.00. They then may call you and settle for half. Should you pay? It’s your choice.

  2. Reply
    errantskitten
    June 21, 2011 at 11:52 pm

    hi

    The statute of limitations can mean a couple of different things, I believe what you are asking is how long will it stay on your credit report. The answer to that is typically 7 years. However, you can go into your credit report with each of the big three and dispute the debt, at that point the company you owe money to will have to prove you owe it, and well for 200.00 they probably wont bother.

    That would be the first step I would take, jsut get your report from Transunion, Experian and Equifax, you can get one free report each year and you can apply for all three at once on https://www.annualcreditreport.com. you will get a reference number, then you can dispute it and try to get it removed.

    honestly though since it is so old it probably isnt bearing much weight on your overall score, a more recent ding would have more weight.

    Now, that being said, there is also a stuatue of limitations that each state has that is the outside limit wehre a company can sue you for a back debt, in colorado if its a credit card its 6 years, and most states have similar limits, based on the type of debt it is.

  3. Reply
    Smoovy Loco
    June 22, 2011 at 12:34 am

    Ok, for starters, that $ 200 bill that’s slated to be removed in December actually isn’t hurting your score, being that debts that are less than 2 years old hurt your score the most. As far as the statute of limitations(SOL) that expired sometime last year, so there’s no legal ramifications if you don’t pay it. So in short, you have 2 options.

    1. Wait it out.-Like I mentioned earlier, it doesn’t have any direct bearing on your score since the collection is so old. There’s no sense in wasting the money paying the money and it staying on your report anyway.

    If you do decide to pay it

    2. Negotiate a “pay to delete”- A “pay to delete” is a payment in exchange for removing it from the report. Since the SOL has expired, and the collection agency will have to write the debt off for tax purposes, you could settle it for much less. I posted several links that explains this more in detail

    http://www.creditinfocenter.com/debt/settle_debts.shtml

    http://www.creditinfocenter.com/debt/neg_rating_after_settle.shtml

    http://www.creditinfocenter.com/debt/CanCreditorSue4SettlementDifferences.shtml

    http://www.creditinfocenter.com/debt/ActualDebtSuccesses.shtml

    http://www.creditinfocenter.com/debt/debt-negotiation.php

  4. Reply
    omfgitsrobmoney
    June 22, 2011 at 1:08 am

    1. Get your date of last payments for each debt. Dont be afraid to call the agency and ask them for the information.

    2. NEGOTIATE!!!! If you really want to pay your debt, make offers! Hiring an attorney or a debt consolidation company is a waste of money. YOU CAN DO EVERYTHING THEY CAN DO. Get all offers in writing. Make sure they are specific.

    3. Believe it or not, most agencies will give you a couple months to pay settlement offers. If they offer you a lucrative settlement offer…ask them if you can break it down in 3-4 payments. (be sure to get everything in writing)

    4. CALL AT THE END OF THE MONTH. This is a very important step in settling. Agencies are more prone to settling lower offers at the end of the month.

    5. When everythings said and done…STAY THE HECK OUT OF DEBT.

  5. Reply
    Studly
    June 22, 2011 at 1:38 am

    Loco’s answer is the best. The others are bill collectors and who listens to them anyway???

    Just to add to Loco’s info….are you worrying about this debt because you plan to seek a loan in the near future?

    If not, don’t worry about this debt. They can not sue you, and the only harm is to your credit report. As mentioned, one negative that is 5 years old does not harm your credit that badly.

    If you cave in and negotiate a settlement, remember this very important point! It does NOT automatically delete this item from your report. All they are required to do is show the balance is paid, but any info about collections, charge off’s and late fees will remain on your report, and it will STILL be a bad mark. To make it worse, it updates your credit report to show this as a recent activity….and THAT can actually hurt your credit score.

    I see that our collection agent responders didn’t point out this fact to you…I wonder why?

    So do NOT pay this debt unless they agree IN WRITING to DELETE this item from your credit report.

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