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Collectors in NY, NM, WI, MS Forced to Tell Consumer if Debt Can Be Collected

By on January 21, 2011
Collectors in NY, NM, WI, MS Forced to Tell Consumer if Debt Can Be Collected

The New York Times is reporting that more consumers will now be informed if old debts can be collected through the court or if they have passed the statute of limitations.

Bill collectors in New Mexico will be soon required to inform borrowers they can’t be taken to court for long-overdue debts, changing the landscape for consumers and creditors in the state.

A handful of states and cities have addressed the issue, which has gained attention from the Federal Trade Commission as debt-collector complaints have risen.

Since April 2010, New York City has required debt collectors to notify consumers in writing if the debt has passed the statute of limitations, known as “time barred.”

Statutes vary by state but nearly all have a time limit for credit-card debt.

In New Mexico, Attorney General Gary King adopted a rule in December requiring debt collectors to inform borrowers if the loan they are inquiring about has passed the statute of limitations—four years for most credit-card debt in that state. By law, lenders can’t go to court to collect on such loans.

Read the full story, here.


READ  7 Things You Need to Know About the Statutes of Limitation for Debt

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About Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

2 Comments

  1. Damon Day

    January 21, 2011 at 7:48 pm

    Good, one less thing that collectors can try to use to threaten consumers with. Most people would be surprised how often collectors successfully collect on time barred debts by threatening a lawsuit.

  2. Damon Day

    January 22, 2011 at 12:48 am

    Good, one less thing that collectors can try to use to threaten consumers with. Most people would be surprised how often collectors successfully collect on time barred debts by threatening a lawsuit.

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