SOL reset

[Anonymous]

Ok, I realize this is not the most ethical question but I will ask anyway! Once a SOL you can no longer be sued for the money. In TX it is 4 years, so after 4 years if I leave it alone until the 7 year mark it will come off of my report AND I won't have to pay it....and noone can legally collect a judgement or anything once the 4 years have passed?

[Anonymous]

Forgot the last part of my question, if I were to make a payment or inquire about the account, the SOL could reset to another 4 years....is that correct? So as long as I leave it alone once I get past 4 years I am in technically free of needing to repay?

[pizzadude]

You will have to look into how your state handles resetting of SOL ~ it varies by state. But in general the way it works is that if you are sued after SOL expires then you would show up to court and use SOL as your defense.

If you are talking about the SOL for a judgement then it is more complicated because in some cases judgements can be renewed. Again you would need to look up the specifics for your state to see how this applies.

[RobertEG]

Its not an unethical question, as the statutes of limitations are there for just that purpose..... to avoid having to defend old, stale debts where both mind and records have become fuzzy.

Once the SOL has expired, and yes, the expiration provisions vary widely by state, then you no longer legally owe the debt.

In some instances, a party who brings legal action on a knowingly time-barred debt can be subject to counter-suit.  They are not necessarily free to sue and make you defend.  A good example are actions brought by debt collectors.  There is a substantial body of federal and state case law that holds that bringing legal action on a knowingly time-barred debt is a violaltion of the FDCPA. 

You would be well-advised to know the date that controls the beginning of your SOL, and keep adequate records to support a showing of that date should you ever be dragged to court.   Don't trash your records just because you feel SOL has expired.  You may have to prove it.

[Anonymous]

As a fellow Texan, I've previously done some research on this (and gathered wisdom from fellow forum members!)

You're right - in Texas, the SOL is four years past the date of last activity (usually payment). In short, if a debt collector does sue you, you have a valid defense and will win. (If you're up for it, this may open them up for a counter-suit anyway). Basically, nobody would logically bring suit against debt past SOL.

However, Texas is also lenient on resetting this clock... If you so far as acknowledge the debt is valid, this will reset the SOL. Typically, this is making a payment. However, if you say (verbally or written), "Sure, this debt is mine," or, "Yes, I'll make a payment," that could constitute "new activity" on the account and restart the SOL clock. Importantly, this can also include the inital calls (after a first missed payment) from the original creditor, if you say, "Yes, I'll make another payment" or some such. This is different from many states I believe, because most states will require an actual payment to change hands.

All ethics aside, nothing stops collectors from trying to collect, but tons of info on dealing with that can be found elsewhere.

Note I am not a lawyer, and the above does not constitute legal advice

EDIT 2: I believe the mark for collections to stop showing up on credit reports is usually 7 years and 180 days, to answer your other question. Collection agencies can continue to report as long as they want.