Portfolio Recovery Statue of Limitations

[Anonymous]

Hi, first time posting. I have a debt that Portfolio Recovery is trying to collect on. My last payment was 10/2013 to Capital One.  Portfolio lists the "Seller" as Capital One Bank, and then lists "Original Creditor" as HSBC Bank of Nevada.  I am not sure which one would be the State to use the Statute of Limitations on. Capital One is HQ in NC where SOL is 3 years (so I would be beyond the point of suing from Portfolio), but HSBC is in Nevada (which is 4 years). I think it should be Capital One. But not sure. Also, I am trying to get a mortgage, I want this off my credit report which this popped up on recently.  What should I do? I disputed the charge on Equifax and TU but Portfolio came back and sent me documentation showing my last payment in 10/2013..  Please help with any advice on how I should move forward with this. I live in NY state if that makes a difference.  Thanks!!

[bizarrocreditworld]

It's your state of residence that typically applies for SOL purposes. The bad news is that in NY, the SOL is six years, however, if the debt is paid within five, it is supposed to be removed from your credit reports at the five year mark. If it is not paid and a lawsuit is not filed within six years, it can still be reported up to seven years and 180 days after the date of first default (DOFD), which would mean in your case up to early 2021.

The problem you have with the mortgage is that the lender will want the debt paid off before they can give you the loan. I will leave how to handle that with those on MyFico who know more than I do.

[Anonymous]

+1

Yep, what bizarro said! BTW, what an apt moniker. Good luck with it all, OP.

[Anonymous]

Just another stupid thought. Perhaps an address change to NC is in order. Wonder if Duke or Chapel has any distance learning courses? Just a thought...

[RobertEG]

The statute of limitations that would apply in any civil action would be the statute of the state where the court resides.

Thus, the SOL will be determined by the jurisdiction where the civil action is filed.

A debt collector has the explicit option under FDCPA 811 to bring civil action in either the jurisdiction where the contract creating the debt was signed OR in the jurisdiction of current residence of the consumer.  That contract was apparently with HSBC.

For various legal reasons, such as enforcement of any judgment that might be obtained without need to first "domesticate" the judgment in another state, debt collectors will usually bring civil action in the consumer's state of current residence.

The entire issue of SOL becomes moot if you pay the debt.

Yes, collections are subject to a five year exclusion provision for current NYS residents rather than the 7 year period under the federal FCRA, so I would advise paying the debt and using the NYS exclusion provision to then obtain exclusion of their collection.

What is the DOFD reported by the debt collector?

[Anonymous]

I looked into it more. Apparently the SOL laws apply to where the card issuer is Headquartered. Capital One is headquarted in VA which has a 3 yr limit but they have a caveat that its 3 years unless the card holder lives in a state that has a longer SOL (so NY is 6 years). HSBC is also Headquartered in VA so same. My last payment was 10/2013.  It's just that a message popped up when I went to the Portfolio Recovery site to see what they say I owed, that a pop up message said that this account may be an account that has reached it's SOL. I was just trying to see if I had more leverage to make a deal knowing they can't sue me. I want to try and make a one time settlement payment for less than the amount owed. I know that if I call them, and make a settlement it could start the clock over (or does that only happen when you pay). Anyways, I have to do this quick as they are the only derogatory thing on my credit report and I need to apply for a mortgage asap and our mortgage person feels that if I can show that we at least settled that account, we can get something.  Any other thoughts on how to handle Portfolio when i call them? Should I tell them I have to see the agreement in writing before any payment is made?  Thanks so much!  @robertEG

[Anonymous]

If they settle on less than the full payment to settle the debt, would I still be able to institute the exclusion clause? should i get that in writing also? The thing is the original debtor , HSBC, still shows on my report as "charged off" . Im guessing I can only get Portfolio to be removed from the report and not HSBC correct?

[medicgrrl]

Exclusion, as in NY state law excluding at 5 years?

[RobertEG]

The FCRA requires that any reported collection or charge-off must be excluded from any credit report issued by a CRA no later than 7 years plus 180 days from the date of first delinquency (DOFD) on the account with the original creditor.  That applies regardless of whether the debt is paid or unpaid.

New York State has enacted a shorter statutory period of only 5 years for exclusion of collections and charge-offs.

However, the wording of the NYS statute has led to differing interpretations by the different CRAs, as it does not specifically base the exclusion period on DOFD, and there is also an interpretation applied by one CRA that the debt must have been paid in full.  A search of the forum for prior discussion of the NYS five year exclusion statute will provide details on interpretation of that statue.