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How to Handle Collection Lawsuits Over Unpaid Debts in California


In California, a debt collector has a short period of time to sue a debtor for an unpaid debt (also referred to as the statute of limitation). For example, a collection agency has two years to file a lawsuit against a debtor to collect an unpaid debt if an oral agreement was made, or four years for credit card debts (open-ended, revolving credit accounts), or if a written contract or promissory note was executed.

The statute of limitation will start to run when the debtor no longer makes payments on the outstanding debt. Unfortunately, collection agencies often use underhanded tactics in order to extend or revive the statute of limitations. For example, the collection agency may actually extend the time the debtor has to make a payment in an effort to extend the statute of limitation. If the debtor makes a payment during this extension period, then the statute of limitation will start all over again. In many states, collectors can restart the clock if they can persuade the consumer to make even a very small payment toward the old debt. Debt collectors generally do not tell consumers that making a payment will revive the debt so it can be legally pursued.

Alternatively, the collection agency may request that the debtor waive the statute of limitation on a debt. If he/she agrees, the debtor will forfeit their right to contest any statute of limitation provisions of a collection lawsuit regarding the debt.

To prevent the collection agency from winning a judgment regarding the unpaid debt, you must state that the statute of limitation has expired and bring evidence to your court appearance to back up your claim. You can assert additional defenses as well at the hearing.

It is important that you do not ignore the collection lawsuit filed against you. Ignoring the lawsuit will not make it go away. If you are being sued by a collection agency, you should consult with an attorney to discuss the legal ramifications of the unpaid debt. An attorney at our firm can help guide you on how to best protect yourself against the collection agency.

Contact us to schedule a consultation to meet with our debt collection attorney about your situation. The attorneys of Fitzgerald & Campbell in Orange in California have decades of combined experience resolving clients’ debt collection and harassment challenges. Call (844) 431-3851 to talk with a debt collection attorney. We are here to help you.

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