Showing results for 
Search instead for 
Did you mean: 

Getting sued by junk debt collector, Is a judgement just as bad as bankruptcy?

Super Contributor

Re: Getting sued by junk debt collector, Is a judgement just as bad as bankruptcy?

There are 2 clocks:

First clock: How long the collection remains on your credit report

A collection will remain on your credit report for seven years and 180 days from the original delinquency date. Typically, it does not matter what amount you owe or how you incurred the debt.

Paying off a debt in collections does not impact the time it remains on your credit report. Paid or unpaid, the collection will remain on the report for seven years and 180 days (except for in the state of New York, where paid collections remain on your account for five years from the date paid). However, this doesn’t mean you no longer owe the amount to the collection agency—it just comes off your credit report.

Second clock: How long you can be sued for the debt

According to the statute of limitations, a collections company can only sue you for a debt if it brings the case to court within a certain timeframe. This time period differs in each state but varies between three and ten years. This second clock sets a limit on filing a case with the court, and it has nothing to do with the credit reporting agencies or your credit report.

Once the allotted time has passed, depending on state law, a collections agency cannot sue you for the debt. But the debt is not forgiven, and the collections company is typically allowed to contact you until the debt is paid.

This clock starts from the last payment date, so unlike the first clock, payment activity will affect it. In fact, any type of payment or, in some states, a written agreement to pay the debt, can be considered activity and can restart the clock on the statute of limitations.

Message 11 of 12
Frequent Contributor

Re: Getting sued by junk debt collector, Is a judgement just as bad as bankruptcy?

In a situation like this, your best bet to win is to keep forcing them to produce documents and go through the discovery process. The longer it takes them and their attorney to work on this case, the higher the probability is that it will be dismissed by them or the court. The colection is only $1,800 and attorney's fees add up fast. As other have mentioned, they are really just expecting you to ignore it so they can get a default judgment against you.


The easiest way out would be to settle with them, rather than fighting. If you choose to fight them in court, there is no guarantee you can win the case, although there is a good chance if the debt is really old (and potentially outside of your state's statute of limitations on consumer debt). If you settle, there will be no judgment against you. And DO NOT agree to a consent judgment or agreed judgment as it is also known. If they ask for this, tell them you will be sending a lump sum payment using certified funds, so there is no need for it. You should first obtain a written settlement agreement from their attorney, ensure that the case will be dismissed with prejudice by them (per the agreement), and then you send them the money via a trackable method using certified funds. The choice on what to do is up to you. You can settle this debt all the way up until moments before you are scheduled to go to court, so it is something to consider if you think they might win.

Message 12 of 12
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.