Statute of Limitations for Consumer Debt Collection Lawsuits

A random selection of bills or invoices with one of them stamped ” PAST DUE”.

If you fail to pay a debt, you will likely receive phone calls and letters from your lender. Then, your lender may decide to file a lawsuit to obtain a judgment against you or may sell your debt to another company, which may begin its own collection efforts. Many people think they will simply have to live with the fear of a lawsuit for the rest of their lives if they do not pay the debt. However, in California, the law protects consumers from the never-ending possibility of a lawsuit.

Each state sets out a statute of limitations for consumer debt collection lawsuits. This is the time limit the owner of the debt has to take legal action against a debtor. The large majority of credit cards and other debts are based on written contracts, and the statute of limitations to take action for a breach of a written contract in California is four years from the date of the breach. In consumer debt cases, non-payment of the debt is the breach of the agreement and when the statute of limitations usually begins to run. After four years passes, the creditor no longer has the right to file a lawsuit.

What Happens if They File after Four Years?

Just because the law prevents them from filing does not mean that some creditors will not try to pursue a lawsuit after the statute of limitations expires. In these cases, a skilled attorney can seek to have the lawsuit dismissed. This is only one of many reasons why you should always contact a consumer debt lawyer as soon as you learn a creditor has filed a lawsuit against you.

Contact an Experienced California Consumer Protection Attorney

The consumer protection lawyers at Martin & Bontrager, APC protect the rights of consumers against creditors and other parties. Call 323.940.1700 or contact us online if you would like to discuss a potential case.