Many people in Indiana go through periods in their lives in which they struggle with debt. With some hard work, some sacrifices and some luck — and perhaps some help from debt relief professionals — they may get their financial houses in order and put the hard times behind them. But for some people, something from the hard times comes back and bites them.
What can you do if you hear from a debt collector about an old debt?
Indiana has a statute of limitations for debt collection. For most types of debt, collectors may not file suit to collect debt that is more than six years old. Two exceptions are car loan debt, which has a statute of limitations of four years, and state income tax debt, which has a statute of limitations of 10 years. Debt that is older than the age designated in the statute of limitations is sometimes known as time-barred debt.
If you hear from a debt collector about an old debt, you can ask the collector if the statute of limitations has passed. Under state and federal laws, the debt collector must answer truthfully if they know the answer. However, it’s possible that a debt collector might not know the answer, or might simply refuse to answer.
It’s important to note that the statute of limitations applies to the debt collector’s ability to sue you over the debt. If the statute of limitations has tolled, the collector cannot file suit over the debt, but this does not necessarily mean you don’t still owe the money. The debt could affect your credit score or show up in other ways. If you are contacted about old debt, even time-barred old debt, it may be a good idea to talk with an attorney who has experience in debt relief to learn about your options.