When you’re dealing with a debt collector or debt buyer who is suing you, you may wonder, “What exactly is the Statute of Limitation on an old credit card debt in Alabama?”
We believe that it’s 3 years. This is known as an “open account” — the credit card had no fixed term. Its not like a car loan (60 months) or a home loan (30 years) — instead you can use it or pay it down. And then the next month you can use it or pay it down more (as long as make the minimum payments).
However, some collection lawyers believe that it’s 6 years that they have to sue on old credit card debt.
Since they believe this, they will sue you under “breach of contract,” or “account stated.”
Both of these claims have 6 year statute of limitation.
We believe this is wrong as those theories or legal “causes of action” don’t apply here, but we also have to realize that they’re trying to sue after 3 years if no payment has been made. So they have to come up with some theory to justify what they are doing.
When they do this, we will put statute of limitations as a affirmative defense when we defend ourselves.
Sometimes people will say, “I’m not worried about it, because I read on the internet that the statute of limitation is 3 years.”
Well, it is 3 years for an open account.
The real question is whether they can sue you for something beyond 3 years.
We don’t want to go into court and naively say, “Judge, it’s 3 years for statute of limitation.”
Especially when the collection lawyer will be there saying that it’s 6 years. We have to be able to answer their arguments.
Here’s the secret though . . . The bottom line is that we rarely rely on the statute of limitation in a collection lawsuit.
Most people get so fixated on statute of limitation when there are better defenses that can be used.
Does the debt buyer even own the debt? That’s a critical issue in these debt collection cases.
If you live in the state of Alabama and you have any questions, you can call us at 1-205-879-2447.
We will gladly walk you through your 5 options, and help you decide the best course of action.
I look forward to chatting with you.
Have a great day!