So how long is the statute of limitations? The answer is, “it depends.” First of all, the statute of limitations depends on the location. For example, in San Antonio and throughout Texas, the statute of limitations for contracts involving both written agreements and oral agreements, for a debt, the limit is four years according to the Texas Civil Practice & Remedies Codes § 16.004(a)(3) and (4).
The statute of limitations might also vary depending upon different types of debts. For example, the statute of limitations for a student loan could be different than the limitations for a home loan. Be sure to get in touch with trusted legal counsel to find out whether or not your debt is time-barred.
Another factor to take into consideration is when the “clock starts ticking” so to speak. The statute of limitations usually begins when the debtors fails to make their first payment. If you have calculated that more than four years have passed since your failure to make a payment, and a collector is calling you about that particular debt, then you may want to seek legal representation right away as they could be attempting to wrongfully collect a debt.
The Federal Trade Commission (FTC) lists three basic options that are available to you if you find yourself in this type of situation. Your first option is to do nothing and pay nothing on the debt. Since the debt is time-barred, you cannot be sued. Unfortunately, even though you cannot be sued, you technically still owe the debt which means that the collectors could continue to call you for payment. The major consequence of not paying a debt is that it could hurt your credit score.
Another option is to make a partial payment on your time-barred debt. Once you pay a debt that is older than four years, the clock could potentially start ticking again. In other words, the statute of limitations could be reset and the collectors are again allowed to sue you for payment. The last option would be to pay off the debt entirely. Talk to your creditor about payment options because they may even be willing to reduce the total amount that you owe. For more information on statute of limitations for debts, contact a San Antonio bankruptcy attorney from our firm.