Legally, collection agencies cannot report old debt as new. If a debt is sold or put into collections, that is considered a continuation of the original date. It may show up multiple times on your credit report with different open dates, but they must all retain the same delinquency date.
But what happens if the same debt is listed multiple times on your report? As the Consumer Finance Protection Bureau (CFPB) has explained, this is not a “harmless error.” That's because credit bureaus don't recognize all these entries as duplicates showing the same debt.
Yes, the account can be re inserted to your reports, as long as it is less than 7.5 years after you stopped paying on the original debt. It could be transferred for a different collector, and re added. Or, it could be voluntarily removed, and later re inserted.
Keep in mind that making a partial payment or acknowledging you owe an old debt, even after the statute of limitations expired, may restart the time period. It may also be affected by terms in the contract with the creditor or if you moved to a state where the laws differ.
The time frame varies from state-to-state but is generally 3-6 years.
If you are struggling with debt and debt collectors, Farmer & Morris Law, PLLC can help. As soon as you use the 11-word phrase “please cease and desist all calls and contact with me immediately” to stop the harassment, call us for a free consultation about what you can do to resolve your debt problems for good.
Your original creditor may be most willing to take your debt back if you have already worked out a plan with your debt collector and begun repaying what you owe. However, there's no guarantee that the creditor will reaccept the original debt.
An account may be removed from your credit report after a successful dispute or if the credit bureau determines it should not be there. However, it can be put back if the furnisher (like a lender or collection agency) provides new or additional information that justifies its presence.
Can a collection agency open an old debt as new? A collection agency can't report an old debt as new. If your creditor sells an old debt to an agency, the timeline simply continues from where it left off.
The lender should close the old account once it's transferred, and the debt collector will then report it as a new account. But sometimes, the lender continues to report the debt as well, so you'll see the default twice on your report.
Report the Violation: Being pursued twice for the same debt violates city, state, and federal laws. Report the violation to appropriate agencies, such as the New York State Attorney General's office or the Consumer Financial Protection Bureau, to ensure the creditor or collection agency is held accountable.
Certain types of debt or derogatory marks, such as tax liens and paid medical debt collections, will not typically show up on your credit report.
You're not obligated to pay, though, and in most cases, time-barred debts no longer appear on your credit report, as credit reporting agencies generally drop unpaid debts after seven years from the date of the original delinquency.
Types of debt that cannot be discharged in bankruptcy include alimony, child support, and certain unpaid taxes. Other types of debt that cannot be alleviated in bankruptcy include debts for willful and malicious injury to another person or property.
The amount of time that a debt collector can legally pursue old debt varies by state and type of debt but can range between three and 20 years. Each state has its own statute of limitations on debt, and after the statute of limitations has expired, a debt collector can no longer sue you in court for repayment.
If you recently had an item deleted from your credit report as a result of a dispute, it can be surprising if the collection suddenly reappears. Although this doesn't happen often, it is possible for disputed collections to reappear on your credit report. Credit files can be tricky.
If six years have passed since the item showed on your credit report, the account may have been automatically removed. The majority of items remain on your credit report for 6 years. After this time has elapsed, the items are removed from your credit report.
If you had late or missed payments but brought the account current before closing it, the late payments will fall off your report after seven years—but your account may remain on your report for up to 10 years depending on when it becomes "positive," meaning all negative information has been removed.
Re-aging can reset the statute of limitations clock on a debt, giving the creditor or debt collector more time to take legal action. Debtors can inadvertently trigger re-aging by acknowledging the old debt or making a partial payment on it.
Debt collectors are not permitted to try to publicly shame you into paying money that you may or may not owe. In fact, they're not even allowed to contact you by postcard. They cannot publish the names of people who owe money. They can't even discuss the matter with anyone other than you, your spouse, or your attorney.
If they do not bring court action within the applicable time limit then the debt may become statute barred. An unsecured debt might be statute barred if any of the following has not occurred in the past 6 years (or 3 years for the Northern Territory): You have not made a payment.
Specifically, the rule states that a debt collector cannot: Make more than seven calls within a seven-day period to a consumer regarding a specific debt. Call a consumer within seven days after having a telephone conversation about that debt.
Debt relief or debt cancellation is the partial or total forgiveness of debt, or the slowing or stopping of debt growth, owed by individuals, corporations, or nations. From antiquity through the 19th century, it refers to domestic debts, in particular agricultural debts and freeing of debt slaves.