Understanding Time-Barred Debts

Time-Barred Debts

The collection of debt is often slow and challenging. If a creditor does not manage to collect on time, it could cost them the chance to collect altogether.

When a consumer owes money, a creditor must take specific steps to collect the debt within the statute of limitations.

Statute of Limitations

The statute of limitations is a legislative act limiting the time within which legal proceedings may be initiated after the events that gave rise to the cause of action. In general, the time allowed under a statute of limitations varies depending upon the nature of the case or offense.

These statutes are enacted to protect persons against claims made after disputes have become so stale that evidence has disappeared, memories have faded, or witnesses can no longer be found.

How does the Statute of Limitations Relate to Collecting Debt?

Creditors or collection agencies can only take legal action against a person or business to collect a debt for a certain period of time. That means that, once that time period has passed, the creditor will not be able to file a collection lawsuit to collect the debt.

Determining the Statute of Limitations

The statute of limitations on time-barred debts is based on a certain event occurring. For most debts, it is based on the date of the last charge or payment. In Georgia, the statute of limitations is six years for a written contract and four years for an oral contract.

Aggressive, Cost-Effective, and Efficient Legal Service

If traditional collection strategies are not working, Diwan Law can help.

At Diwan Law, we will manage your business collections while you concentrate on moving forward with your business and life.

Contact An Experienced Georgia Collection Lawyer

For effective collection services and judgment collection, contact the Georgia commercial collection attorney at Diwan Law by calling 404-635-6883