UnPaid Debt and Statute of Limitations

There are two statutes of limitation (SOL) clocks involved in protecting consumers who have defaulted.

The first clock controls debt collection and the second clock controls credit reporting.   The clocks are completely separate and do not influence one another whatsoever.

The First Statute of Limitations is how long the creditor can file a lawsuit for the unpaid debt .  Consumers can  accidentally restart the SOL clock on previously time-barred collections.  For example a consumer living in FL decided to make a payment on the debt (rather than paying or settling the debt in full)  this restarts the  the SOL clock for debt collection allowing the creditor another five years to sue.

Certain types of debt, such as federal student loans and tax liens, will never become time-barred.  There is no SOL clock and no expiration date for the collection of these obligations.  Consumers with defaulted federal student loans can have their wages garnished, their tax refunds seized, and even their estates can be responsible for satisfying the unpaid debt in the event of their death.

The second statute of Limitations is how long  your credit report is affected.  The credit reporting SOL clock is governed by the Fair Credit Reporting Act. The FCRA dictates when an item must be purged from a consumer’s credit report based on the type of account or financial obligation.

# of Years an Item Is Allowed to Remain on a Consumer’s Credit Report: Type of Item:
  • Unpaid Tax Liens
  • Unpaid Federal Student Loans
10 Years
  • Chapter 7 Bankruptcies (10 Years from Date Filed)
  • Chapter 13 Bankruptcies (7 Years from Discharge Date, 10 Years Max)
7 Years
  • Charge-Offs
  • Judgments
  • Collections
  • Foreclosures
  • Repossessions
  • Released Tax Liens
  • Late Payments


# of Years Before a Debt Becomes Time-Barred: State:
15 KY and OH
10 IL, IN, IA, LA, MO, WV, WY
8 MT
6 AL, AK, AZ, AR, CO, CT, GA, HI, KS, ME, MA, MI, MN, NV, NJ, NM, NY, ND, OR, SD, TN, UT, VT, WA, WI
5 * FL, ID, NE, OK, RI, VA* Deficiency on Mortgage in FL is 1 year after Final Judgment of Foreclosure
4 CA, PA, TX
3 DE, MD, MS, NC, NH, SC, Washington D.C


Carol A. Lawson, Esq., 28870 U.S. Hwy19 #300, Hodusa Towers, Clearwater, FL 33761, Phone: (727) 410-2705 email: calh@gate.net