Statute of Limitations on Debt Collection In New York

If you are on either side of a debt collection case, you might find yourself in court fighting against or asking for a judgment that the debt must be paid. One of the most important things to keep in mind in these types of cases is determining what the statute of limitations is for the type of debt involved and a business attorney can help.

Definition of Statue of Limitations

The statute of limitations is simply a rule that sets a deadline for somebody to file a lawsuit or, in criminal law, to charge someone with a crime. In debt cases, it’s used as a defense to avoid a judgment ordering the debtor to pay up. The law that governs the statute of limitations on debt collections in New York can be found in Article 2 of the state’s Civil Practice Law and Rules (CPLR). The statute spells out the amount of time the debt collector has to file a lawsuit to collect what’s owed.

Different Types of Debt Collection Cases Covered

Different types of cases require different types of debts. For example, Section 211 of the CPLR allows for a 20-year statute of limitations to collect on alimony, maintenance and child support. Section 212 creates a ten-year statute of limitations to recover real property, annulment of letters of patent or for a mortgage company to redeem a mortgage. Under Section 213-a of the CPLR you have four years to recover payment for a rent overcharge. In such cases, the statute begins to run at the time of the first alleged overcharge. You have three years to collect to recover chattels, or personal property other than real estate; damages for injury to personal property; or damages for malpractice claims other than medical or dental malpractice under section 214.

The section of the CPLR that is going to apply in a large number of debt collection cases is section 213. This section sets up a six year statute of limitations on contracts. This could apply in cases involving credit card debt. Section 214 also applies in cases involving sealed instruments, which are written agreements that are signed and sealed by two parties, binding both of them. Actions based on mistake, actions by a corporation against one of their directors and actions based on fraud are also covered by section 214.

Other Issues Related to Statute of Limitations

Despite the six-year statute of limitations that covers contracts such as those involved in credit card cases, parties in such cases should be aware of other factors that could play into these cases. Section 202 of the CPLR states that if a cause of action which gave rise to the debt collection suit were to arise outside of New York state ,the statute of limitations of the outside state would apply. That’s exactly what happened in a case decided by the New York Court of Appeals, the state’s highest court, which allowed the three year statute of limitations in Delaware to apply rather than New York’s six years in a credit card debt case because the bank that issued the credit card was located in Delaware.

Finally, creditors and debtors should pay attention to how the statute of limitations is computed, which is covered by Section 203 of the CPLR. The statute begins to be computed from the time the cause of action arises. Debtors should watch out for situations where they resume paying off a debt that hadn’t been paid for a while because that might restart the statute of limitations for the creditor.

New York’s statute of limitations in debt collection cases may work in your favor or work against you. Either way, you should know your rights. The law office of business attorney Mikel J. Hoffman can advise you on debt collection issues and business law. Call us now, or fill out our form to get a free consultation.

The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding creditors or any federal or state tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation.

Ohio debt statute of limitations on medical bills

The statute of limitations is a rule that sets a time limit within which a creditor may sue you for payment of a debt. The length of time that a creditor has to sue you on an unpaid debt varies from state to state. In some states it's four years, in other states it might be longer. The time limit may also depend on whether your agreement with the creditor is in writing or not, and whether the debt is a special type, like a revolving or open-ended account. To find out your state's SOL's, see our state by state listing below.

If the time limit to sue on the old debt has expired, that does not mean that a creditor or bill collector must stop contacting you about it. They can ask you to pay the debt, they just can't sue you for it.

Written Contract: You agree to pay on a loan under the terms written in a document that you and your debtor have signed.

Oral Contract: You agree to pay money loaned to you by someone, but this contract or agreement is verbal (i.e., no written contract or handshake agreement). Remember a verbal contract is legal but it is tougher to prove in court.

Open-ended Accounts: These are revolving lines of credit with varying balances. The best example is a credit card account. Note: A credit card is ALWAYS an open account.

Statute of limitations on medical debt collection

Chart providing details of Ohio Civil Statute of Limitations Laws.

Statute of limitations on medical debt collection

Find out the statute of limitations on debt in your state Every state is different and it is important to know the statute of limitations on debt in your.

Statute of limitations on medical debt collection

This is a list of all 50 states containing links to the particular state laws regarding acknowledgement of debt and the statute of limitations.

Statute of limitations on medical debt collection

Does medical debt ever go away Statutes of limitations stop creditors from filing suit It may fall off your credit report after 7 years or 10 or 17.

Statute of limitations on medical debt collection

After the statute of limitations on debt passes you cant legally be sued for payment How to know if a debt is timebarred.

Statute of limitations on medical debt collection

Debt Collection Statute of Limitations were created to protect consumers Find out laws by state and how they protect you by calling 888 8221777.

Medical Debt and Statute of Limitations

I have a medical debt that has been taken over by a collection agency and I don't know if the statute of limitations has run out because I can't get the dates of the services from the hospital because they won't return my calls. This was in the state of Montana. How can I find out the dates and what is the statute of limitations for Montana on a medical debt?

Comments for Medical Debt and Statute of Limitations

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What is the New York Statute of Limitations to Bring a Lawsuit to Collect a Consumer Debt?

Statute of limitations on medical debt collection

The answer is more complicated than you might think.

Section 213 (2) of the CPLR states that the statute of limitations to commence an action upon a contractual obligation or liability, express or implied, except for residential rent overcharge, certain transactions described in the Uniform Commercial Code, or warranties on new homes, must be brought within 6 years after the cause of action accrued. This statute of limitations includes all “consumer credit transactions,” such as credit cards, and is calculated to run from the date of the last transaction (either the last credit purchase, or the last payment made, whichever occurs last in time).

New York’s highest court, the Court Appeals, has recently held that in a debt-collection law suit, if the creditor to which you originally owed the debt is located in another state, then the place where the injury occurred to the creditor is that other state. In such cases, New York’s borrowing statute, CPLR 202, is invoked and the statute of limitations of the creditor’s home state will apply. Major creditors, such as Citibank, American Express, and Discover Bank are almost always based outside of New York. As such, these creditors, and the third-party debt collectors that purchase their delinquent accounts, are subject to the statute of limitations of the home state of the creditor.

The most common state in which creditors incorporate is Delaware, which has a 3-year statute of limitations for debt-collection lawsuits (10 Del. C. § 8106). So, for example, if you had a Discover Bank credit card that you stopped paying on January 1, 2012, and Discover Bank transferred your delinquent account to a third-party debt buyer, such as Portfolio Recovery Associates, LLC, then since Discover Bank is a Delaware Corporation, Portfolio Recovery Associates, LLC, would have until January 1, 2015 to sue you for the debt. Since Discover Bank is a Delaware Corporation, a 3 year statute of limitations would apply to your New York Discover Bank credit card debt, even if your credit card debt is transferred to a local third party debt collector, such as Portfolio Recovery Associates, LLC.

Both creditors and debtors are frequently uninformed as to this rule, and often proceed to litigation under the assumption that New York’s 6-year statute of limitations applies, when, in fact, it might not.

If a debt collector has convinced you to make any payment at any time after you first stopped paying the debt, the plaintiff’s time to sue you starts to run again. For example, if your last payment was made in December 2008, but you agreed in December 2011 to start making partial payments and, in fact, made a payment to the debt collector, the statute of limitations will now be renewed, starting from that 2011 payment, which means the creditor can have up to January 2018 to sue you. There is also something called “tolling,” which means suspending or pausing the statute of limitations. This can occur during any time in which you are not within the state. In other words, if you leave the State of New York for a period of time and then return, the statute of limitation does not run during the time you are out of state. It begins again from where it left off when you return.


If the court finds that the statute of limitations has run and the action is time barred, the case will be dismissed, and the creditor will be prohibited from ever suing you again to collect the debt.

Does Old Medical Debt Go Away After 7 Years?

Statute of limitations on medical debt collection

If you ever needed health care while uninsured, had a plan with a hefty deductible, or you accidently used an out-of-network provider you might ask the question, “does old medical debt ever go away?”

The size of the leftover doctor, hospital, or dental bills can be staggering and often come as a surprise. While unpaid medical bills may disappear from your credit report after seven years, your obligation to make payment never expires.

Medical debt has a statute of limitations. However, the rules work differently that you imagine.

  • The length of time unpaid medical bills stay on credit reports
  • How the statute of limitations affects your obligation to repay

How Long Do Unpaid Medical Bills Stay on Your Credit Report

The length of time that unpaid medical bills stay on your credit report could be seven years or could be ten years, or several combinations in between. The remains on your report for a certain amount of time depending on how it arrived in the first place: collection accounts stay for seven years, and public records can last on your report for up to ten years.

However, even after the record of your medical bills disappears from your credit report, your obligation to make payment does not go away. It stays an obligation to the day you die.

Do you qualify for debt relief? If you owe more than $10,000 in medical bills that you cannot repay, a settlement program could help make the problem go away. If the collection agency agrees to accept less than full payment, they also agree not to sue you in court. This has huge ramifications for your future credit score – as you will shortly see.

Unpaid medical bills on your credit report stay until the patient or insurance company pays them off, or until you reach a settlement with the debt-holder. When you break apart this statement, you find three distinct exceptions.

  1. Unpaid medical bills no longer appear after the insurance company ultimately pays the claim. The bureau will purge the record immediately.
  2. The unpaid status of a medical bill comes off when the patient pays the balance in full. The bureau immediately updates the status to “paid collection account.”
  3. The unpaid status of a medical bill no longer appears after the patient and creditor reach a settlement agreement. The bureau immediately updates the status to “paid settled.”

Paid medical bills do not affect your credit score. Both the “paid collection account” and “paid settled” do not fall off your credit report until seven years after the date of first delinquency. However, the scoring algorithms ignore this information.

Medical collection accounts that remain unpaid stay on your credit report until seven years after the date of first delinquency. During this time, the entries have a serious negative impact on your ability to qualify for new loans.

Successful disputes of medical collections accounts mean that the negative information comes off your file immediately. Expect your rating to improve quickly. However, the process is not easy. You must document that the information is erroneous.

Unpaid hospital bills that remain outstanding stay on your credit report until seven years after the date of first delinquency. However, because hospital bills are frequently very large, patients often find that they appear much longer.

A patient spending just one night in the hospital can wind up with a huge, surprise invoice they simply cannot afford to pay. Collection agencies are far more likely to file a lawsuit to compel payment of the amounts outstanding are very large. They often seek a judgment to place a lien against personal property such as your home, or wages.

An unpaid hospital bill can easily morph into a judgment if the collection agency wins a lawsuit. The court will file the judgment with the county, which then becomes a public record. The bureaus routinely collect and post public record filings.

The judgment will not come off your credit report until seven years after the filing date. The filing date can be years after your hospital admission, and years after your date of first delinquency on the original invoice.

An unpaid hospital bill can also easily morph into a bankruptcy filing, which will not fall off your credit report for seven or ten years. Studies show that major health events trigger half of all bankruptcies. Filing bankruptcy could make your obligations disappear, or allow you to extend your repayment timeframe.

However, doing so will come at a cost to your ability to borrow money. Bankruptcies are also public records, which the bureaus routinely collect and post to consumer reports.

  • Chapter 7 does not purge until ten years after the filing date
  • Chapter 13 does not come off until seven years after the filing date

Does Medical Debt Have a Statute of Limitations?

A statute of limitations is the length of time a party has to take legal action. When it comes to medical debt, the hospital or collection agency has a certain amount of time to file suit in order to collect the outstanding amounts. The length of time, and what happens after its expiration depends mostly on where the person lives.

A debt consolidation loan can provide the funding needed to avoid litigation. You will have to pay interest and fees. On the other hand, you can avoid having a public record hurt your rating for an incremental seven years.

Statutes of limitations vary by the type of contract and the state where the debtor resides. Most medical bills represent written contracts. Many hospitals require new patients to sign a medical patient financial responsibility form, which serves as the written contract. These forms often spell out the patient’s responsibility to understand their health insurance coverage and make payment on any leftover bills.

  • Oral contracts – a verbal agreement to pay back the money
  • Written contracts – a document signed by you including terms and conditions
  • Promissory notes – a written agreement with a specified interest rate, and timeframe
  • Open-ended contracts – has a revolving balance that you can repay and borrow again