Understanding the Statute of Limitations on Credit Card Debt
The applicable statute of limitations or deadline depends on the type of offense, such as breach of contract or negligence. When a consumer defaults on a credit card debt, they are breaching the contract they signed with the lender. In California, a breach of contract action has a four-year statute of limitations.
For example, if a consumer stopped paying a credit card, the lender would have fours years from the first missed payment to sue the consumer. If the lender did not sue the consumer in that four year window, then the lender would lose it’s opportunity to take any legal action against the consumer. The same is true if the lender sold the account to a third-party debt collector. The debt collector would need to sue the consumer within the same four year window that applied to the lender.

Kevin Fallon McCarthy

Latest posts by Kevin Fallon McCarthy (see all)
- Why Student Loan Misconceptions Are Dangerous to Your Finances - March 29, 2021
- 4 Possible Reasons Why Your Student Loan Payment Increased - March 22, 2021
- How Have Student Loans Increased in the Last 10 Years? - March 19, 2021
- Can a Roth IRA Be Useful in Saving for College in Arizona? - March 9, 2021
- What Are My Options to Repay Student Loans as a Nurse in Arizona? - March 1, 2021