Do I Wait Out the Statute of Limitations or Deal With This Now? – Justin

“Dear Steve,

Hey how are you I am 22 and live in Philadelphia area the law states here (i think) that 4 years is the limit for creditors to come after me. Two and 3 years ago I was having too good of credit for my age and was extended an 2000 unsecured bank of america card.

The thing is due to an ex and authorized user at the time the card balance went up to 6600 before i defaulted. The debt has been sold 2 times and a new collection agency reports in each time. they are willing to settle for 50% or 3400 I also have two auto loans 2 by american honda finance the one was auctioned and and debt sold to a new collections they are willing to settle for 40% of the difference which is 3600. The second loan being a charge off due to an accident and the ex yet again (Stealing and not paying auto loans and letting stuff lapse insurance wise).

The amount owed is near 20k this is sold to a different collection comp. they are not willing to settle for anything but 100% and not able to pay 25% so it isnt even a consideration. When I pull my credit it is set to stop reporting in 7 years after i had it on the orig loans. but not sure if it pertains to the collection comp. I also have various medical debts totaling around 20k. I do not have any assets in my name and am not married.

Am an authorized user or a citi card with a 2500 limit and a Gold amex which has a 3000 spending ability both cards I use and spend on. Beyond that I am not needing to use my credit for anything and do not intend on it with in 3 years. Have consulted lawyer about filing but was told to wait until I get sued for something that I can not pay. Also I do intend on needing my credit 3-7 years from now. On my good side of the credit report I do have 5 positive reporting and closed auto loans and do have a decent income currently (wh ich is not reportable) I have never made more than 5k taxable income per year but have not filed taxes since 2005 (graduating high school in 2006) Do intend on filing this year but will be under 5k

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A) Do I listen to the lawyer and just hope that they dont try and to get money from me in court and wait out the 4 years (considering some have 2 more years to wait)

B) Do I wait until the 4 years runs out on the big ones (if it does) and then settle the littler ones?

C) Do I file now and get it over with and start establishing credit over and will this take longer than just waiting and not settling?


Dear Justin,

Based on the information you shared you need to file bankruptcy now and start rebuilding a new financial future as soon as possible.

Waiting only extends all of this out longer. I really can’t see any advantage in waiting. Speak to a different attorney, click here to find a local bankruptcy attorney you like. Make an appointment and go in and talk to them.

Let’s say you qualify for a Chapter 7 bankruptcy. If you file now you case could be discharged in 90 days. The day after it is discharged you can start rebuilding good credit using secured cards. Within two years your credit score will have really improved and within three years, if you save a downpayment and keep your credit clean, you’ll be able to buy a house.

Bankruptcy also closes the door on the debts forever. Waiting for the statute of limitations to run out, does not. Debts outside of the statue of limitations are legally pursued for collections until the person dies. Just because a collector can’t sue you outside of the statute of limitations does not mean they can’t make your life hell. They can and usually do.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.
Damon Day - Pro Debt Coach

Steve Rhode

3 thoughts on “Do I Wait Out the Statute of Limitations or Deal With This Now? – Justin”

  1. I recently received a copy of my credit report. After reviewing it I noticed several accounts duplicated because the original creditor sold my acct to some else. the question I have is does the statue of limitation starts over once the the new agency report it on my credit report although the original creditor already reported the debt when it was owed to them?

    also I have several medical debts from ER visits on my credit report as well. I never made one payment on them. If I never paid anything on them when does the statue of limitation begans? is it when the hospital consider my acct deliquent or is it when its turned over to a collection agency or sold to another lender?

    another question, I recently received a notice in the mail stating if I didnt contact a collection agency that I was going to be sued. The statue of limitations expire in 2011. what should I do. The debt is from a foreclosure. I tried to ask the original lender to do quick sales and wrote hardship letters but they only said they couldnt/wouldnt help so the house went into foreclose. what my issue is this happened the year before the government decided to bail out home owners due to the high adjustable rates the banks and mortage companies were using when people bought their homes. is there any defense I can use to not pay or what should I if I am sued? I do have copies of corresponse I made in attempt to save my home from going into forclosure with the original creditor and names of customer service reps I talked to..will this help me in any way?


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