Virginia Statute of Limitations for Credit Card Debt
Some people, whose credit is really, really bad, don’t need to file bankruptcy, because their debts are barred by the Virginia statute of limitations.
If you can run from your debts long enough–and they never “serve” you with court papers–then they are SOL. SOL stands for Statute of Limitations.
This statute helps people whose credit report is really, really bad. Bad enough that debt collectors look at it and say, there’s no point in bothering to chase this guy. Then, at some point, if they change their minds and try to sue you, they are too late.
So, how long do they have to leave you alone?
Five years if they can produce your signature on a written contract; otherwise three years. That’s in Code of Virginia 8.01-246(2) and (4).
So what’s a written contract? First, they have to come up with your signature. Now you’d think they have hundreds of copies of your signature–on your original card application, and then every time you sign a charge slip. So you’d be surprised this is not easy. I’ve seen credit unions be very good at always keeping your card applications. But credit card banks usually can’t.
If your debt has been sold to a debt collector, they hardly ever have your signature.
Even if they do have your signature on something, maybe that’s not quite enough. To be a “written” contract for this purpose, something in writing has to show the complete agreement–interest rate, payment terms, due date. maybe more. So your signature on one of those charge slips, or the original card application, is not enough. They have to somehow tie in all the fine print. It’s got to be “complete.”
If it’s not complete–can’t find your signature, or can’t tie your signature to ALL the terms of the contract–then the Virginia Attorney General says the “unwritten” contract three year rule applies.
(This doesn’t entirely make sense. A written contract where they can’t find your signature is not exactly “unwritten.” Legal Services of Northern Virginia says maybe the two year rule for “other” should apply. )
I’m pretty sure most judges follow the attorney general three years–not legal services on two.
The protection of the statute of limitations is not automatic. It’s an “affirmative defense.” If somebody sues you on a debt that’s barred by the SOL, they will still win–UNLESS you answer and claim the protection of the statute. You can’t just sit on your rights.
So if you ar relying on the statute of limitations to protect you, do NOT ignore any court papers that come your way.
PS While we’re here, I should add that a promissory note has a six year statute of limitations. A second mortgage would probably be covered under this six year rule.
PPS. Also here’s the link to the Code of Virginia on restarting the statute of limitations. 8.01-229G. A partial payment, without an express promise, is probably not enough to restart the statute in Virginia.
Can they keep calling and billing you on debts too old?
The Fourth Circuit says , yes, they can. At least as long as they don’t threaten to sue. Here’s the decision,Mavilla 4th Cir FDCPA. Even if a credit card debt is barred by the Virginia statute of limitations, phone calls and bills, without some kind of threat, are not illegal, harassing or misleading.