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Sued for Old Debt?
If your last payment on a debt was over four years ago, debt buyers, credit card companies, finance companies, and lenders generally can’t sue you. Lawsuits filed past the statute of limitations violate multiple laws, including a federal law called the Fair Debt Collection Practices Act (FDCPA) and a Pennsylvania law called the Fair Credit Extension Uniformity Act (FCEUA).
If you’re getting sued for old debt, contact us for help. We may be able to win your case and get you a positive monetary recovery. To get a free case review from our debt defense attorney, complete our contact form.
Let us answer your debt defense questions:
Can debt collectors sue on old debt?
For most types of debt, Pennsylvania law prohibits filing suit if your last payment was made over four years ago. This is called the statute of limitations. It applies to credit card debt, personal loan debt, auto loan debt, private student loan debt, and various other types of debt obligations. When a debt is past the statute of limitations, it is called a “time-barred” debt.
Can I ignore a lawsuit filed on a time-barred debt?
No, do not ignore a debt collection lawsuit, even if you think it’s past the applicable statute of limitation. Unfortunately, courts do not independently verify whether a debt collection lawsuit is legitimate. If you don’t point out the flaws in a debt collector’s case, the court will treat the case as valid. In other words, if you ignore a collection lawsuit, the debt collector wins automatically. In fact, if you don’t contest a debt lawsuit, the company suing you doesn’t even have to show up to court to win.
When you ignore a debt collection lawsuit, Pennsylvania courts generally enter a “default judgment” against you. When debt buyers, credit card companies, finance companies, and lenders get default judgments, Pennsylvania law permits them to engage in aggressive debt collection tactics. These include garnishing bank accounts, attaching liens to property, and forcing property sales.
Is it illegal to sue for a debt past the statute of limitations?
Yes. The Fair Debt Collection Practices Act (FDCPA) prohibits debt collectors, debt buyers, and debt collection attorneys from filing lawsuits on debts past the statute of limitations. Pennsylvania’s Fair Credit Extension Uniformity Act (FCEUA) places similar prohibitions on credit card companies and lenders.
What should I do if I'm sued for a debt past the statute of limitations?
If your debt is past the statute of limitations, your best course of action is to hire a debt defense attorney. The reason for this is two fold. First, debt defense attorneys know how to asset a statute of limitations defense. If you don’t properly assert this defense, you could be stuck paying a debt you don’t have to pay. Second, the fees you pay your debt defense attorney may be recoverable against the company that sued you, as explained in the next section.
Are damages available for time-barred debt lawsuits?
Yes. Getting sued on a debt that’s past the statute of limitations is a serious legal violation. There are various categories of damages available. First, the debt collector is liable for any legal fees or costs you paid, and may be liable for up to triple the costs and fees you paid. Second, the debt collector is liable for any anxiety or emotional distress its legally deficient lawsuit caused. Third, the debt collector is liable for up to $1000 in statutory damages. Finally, the debt collector may be liable for punitive damages if it initiated the lawsuit without probable cause.
How much does a debt defense attorney cost?
We charges flat fees to defend debt collection lawsuits, but when you’re sued on a time-barred debt, we often can recover our fee from the debt collector that sued you. Not only that, as explained in the previous section, we may be able to recover significant additional damages against the debt buyer, credit card company, lender, or attorney that sued you. In other words, it usually costs you nothing to hire a debt defense attorney when your debt is past the statute of limitations. In fact, you most likely will end up getting compensation from the company that sued you.