As a Tucson bankruptcy attorney, I can’t tell you how many times I’ve had clients who were by Arizona’s statute of limitations on credit card companies collecting debt from them: some judges interpreted the law as 3 years and others 6 years. So what’s the answer?
New Law to Clarify Arizona Bankruptcy Law
This year, the Arizona State Legislature sided with the credit card companies, and extended the statute of limitations to 6 years. This new law went into effect July 20, 2011. Some lawmakers and debt collector lobbyists claim this will be beneficial for consumers. Those claims are nonsense.
First, it gives debt collectors more time to collect.
Second, it allows debt collectors more time to add-on fees, penalties, high interest costs, and attorney fees to their claims.
I have seen small debts grow into outrageous debts after only a few years. On the positive side, we now have a definite answer to how long credit card companies can collect. Also, this Arizona law change has no effect on your Federal Rights in Bankruptcy Court.
If you find you can’t work out a deal with the debt collectors or handle their harassment, you still have the right to seek bankruptcy protection. For more information, you should discuss your individual situation with an experienced bankruptcy attorney.
How does this affect a collection company trying to collect on a purchased credit card bad debt that shows last payment of 9/29/2005 and a charge off date of 8/2006?
Under previous sol of 3 years.....this debt is barred and uncollectable
Under new sol of 6 years............this debt is still collectable
I'm currently in this situation and now am very confused.
Dear Heather,
This is a comment reply and I can't give you a legal opinion on your specific situation because I haven't seen any of the necessary paperwork in your case that would allow me assess your situation. Further, Statute of Limitation defenses are technical and tricky. However, I can give you general information. A charge off date relates to accounting and credit reporting, and is not relevant to whether a creditor (or subsequent debt buyer) can collect on your debt. In Arizona, the current law allows 6 years to collect on credit card debts. Generally, if your first missed payment was within the last 6 years, the creditor (or debt buyer) can still file a lawsuit to collect. If you want a more definite answer in your case, you can call my office at (520) 745.1500 to schedule a free consultation.
Sincerely,
Jeffrey Judge
Judge Law Firm