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Read this BEFORE you file for BANKRUPTCY! Know the Statute of Limitations on Credit Card Debt in your State!

Updated on March 2, 2019

Did you know that in many states after 3 years of consistent non-payment on credit card bills that the credit card company or collections agency CANNOT sue you for the debt? Did you know that if you don't own a home, or a car, have no expensive assets like a boat for example and have no job that you are considered Judgment Proof? Judgment Proof means that a creditor cannot collect on a judgment even if the do sue you and win.

The following 13 states and Washington D.C. are 3 year states:


Arizona (I was recently told that a new law was passed and Arizona is now a 6 year state)





South Carolina

North Carolina




New Hampshire



If it has been 3 years since you've made a payment on a credit card in one of these states and you've not been sued, the statute of limitations has run out and you cannot be sued for a debt in these states. Your credit will still show the default for another 4 years but after that it will drop off of your credit report as well. The statute of limitations is from 3 years (as in the states above) up to as much as 7 years in Montana, Iowa and Wyoming.

And some states are ambiguous so you might want to contact an attorney and ask what it is for your state if you cannot figure it out using the chart link below. For example in Ohio some attorneys say that the statute of limitations is 6 years while others will tell you it is 15 years. So do your due diligence!

A creditor can still try to collect on the debt, which means he may still call you or write letters and ask you to pay but you are under no obligation to pay and you should probably not even talk to them unless you would like to remind them that the statute of limitations has passed and then hang up immediately after that. If you don't want to be harassed on the phone get rid of your land-line and screen your calls. If you are sued after the 3 years you should most definitely go to the court and tell them that the statute of limitations has run out and the case will be dismissed. If you do not go to court then the creditor can win by default so it is very important that you attend. If you cannot afford an attorney call legal aid.

A lot of people will call an attorney to ask for advice when they get in over their heads and the creditors are calling incessantly. Many bankruptcy attorneys will try to get you to file for bankruptcy (after all that is how they make a living), however bankruptcy stays on your credit report for 10 years after you've filed! If you have already surpassed the 3 year window and live in one of the states mentioned above you will only have to put up with a dinged credit report for 4 more years. It is not in your best interest to file bankruptcy if you fit the above mentioned criteria. Not only that but filing bankruptcy itself can cost quite a bit of money, something you are probably short of or you wouldn't be reading this now would you?! So, if you need advice feel free to call an attorney just don't let them talk you into filing for bankruptcy when you don't need to.

The long and the short of it is to inform yourself of the laws in your state and to proceed accordingly. Do not let the collections agencies or the bankruptcy attorneys dictate your decisions. You must take care of yourself especially considering the economic climate we are now finding ourselves in.

Super Good News!!!


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