When Does the Statute of Limitations Clock Start?

Close up of stopwatch on 20 dollar bills
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The statute of limitations on a debt is the amount of time the debt is legally enforceable, or rather, the amount of time the creditor can use the court to force you to pay a debt. If you're sued for a past due debt, your attorney can use the expired statute of limitations as a defense to avoid a judgment against you. Knowing when the clock on the statute of limitations starts will help you calculate whether the statute of limitations has expired and help you decide whether to pay off an old debt or leave it alone.

The specific statute of limitations for your debt is based on the type of debt you have - e.g. credit card or loan - and the state where you live or the state the debt was incurred.

When Does the Statute of Limitations Clock Start?

The statute of limitations "clock" starts ticking on the date of last activity on your account. Typically this is the date you last made payment, but it can also be the date you last used the account, made a promise to pay, entered a payment agreement, or even acknowledged liability for the debt.

Figuring Out the Statute for Your Debt

Often, you can check your credit report for the last date of activity to figure out when the statute of limitations clock started. That's only if the last activity is a payment or charge to your account - activity that's reported to the credit bureaus and you've had no other activity on the account. Verbal activity, like a payment arrangement or acknowledgment of the debt, is not reported to the credit bureaus, so only your notes or records (if you've kept them) can help you know for certain when the last activity was on the account.

You can ask the creditor or collector for the last date of activity on the account. While they're not required to give you an answer, they must answer truthfully if they decide to give you an answer. If you have doubts about the timing of the statute of limitations for your debt, contact an attorney, especially if a debt collector is threatening to sue you or has already filed a lawsuit against you.

Statute of Limitations vs. Credit Reporting Time Limit

The statute of limitations is often confused with the credit reporting time limit, which is seven years for most accounts. The credit reporting time limit is always based on the date of the last missed payment on the account. Your credit report will include the date of the missed payment for credit reporting purposes.

The statute of limitations can still be in effect even if the credit reporting time limit has passed. In some states, the statute of limitations is more than seven years. Or, you may have restarted the statute of limitations by taking an action, like making a payment arrangement, that's not recorded on your credit report.