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Does a Calif Credit Card Debt Statute of Limitations get extended when the charged off debt is purchased by another agency?

Northridge, CA |

Los Angeles County court summons states two different dates as last paym't rec'd on BofA credit card issued 03/29/2007, first date 12/31/2005 2nd date as 12/31/2009 acct was charged off by original creditor on or about 5/31/10 & purchased by a Colorado collection agency on or about 6/21/10 and that in 02/29/2012 I was notified of their intent to sue me, I don't know this company and the dates are conflicting and seemed structured to fit their purposes. I do not recall having received anything from this company. What can I do to challenge this or receive detailed paperwork from them, am I liable if I do not go to court I just rec'd these papers as everyone in my family is in mourning having just lost my father to cancer in March 2012. Please advise, Thank You

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Attorney answers 3


Statute of limitations runs from date of delinquency to run of statute. It does not extend by selling of debt from company to company. The statute is meant to protect you not the creditor. The charge off date is not the date - the date that a payment was supposed to be paid and then missed. It can get extended if you make more payments or otherwise renew the debt.

The above information does not establish an attorney client relationship nor is it meant to provide legal advice.


No. A "chargeoff" is just an internal accounting technique that means the creditor has taken the debt off their books, and it doedsn't affect your rights or theirs. And likewise, the date of sale or assignment from one creditor to another is transfer of rights that doesn't affect the statute of limitations.

The last payment is your date of breach of this contract, and that's when CA's 4 year statute starts to run. It can't be '05 if the card wasn't issued until '07, so if it was '09, they're within the 4 year statute to sue you. The only other reliably successful defense argument besides expiration of the SoL is that they haven't got proof of their assignment/purchase of your debt.

Did the complaint include a copy of the CO company's assignment/purchase from the CA credit card co.? Did it include a statement showing your 12/09 payment? If not, ask them for them. That will tell you whether you should fight this or not. Don't focus on the '05 typo, that won't be a defense if they can prove the '09 statement.

If this CO company can "validate" the debt by sending you copies of the assignment and the statement showing your '09 payment, you're better off settling this. Because if you drag this out, you'll lose and you'll owe the entire amount plus interest plus their legal fees. But if you dispute the debt while offering them a lump sum now for a franction of the total debt, they'll probably agree to settle for the quick payment, dismiss the suit, and maybe agree to not issue you a 1099 and remove the negative entires from our credit report.

Avvo doesn't pay us for these responses, and I'm not your lawyer just because I answer this question or respond to any follow-up comments. If you want to hire me, please contact me. Otherwise, please don't expect a further response. We need an actual written agreement to form an attorney-client relationship. I'm only licensed in CA and you shouldn't rely on this answer, since each state has different laws, each situation is fact specific, and it's impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue.


Sorry for your recent loss. No, a charge-off does not extend the statute of limitations. A charge-off is the declaration by a creditor (usually a credit card account) that an amount of debt is unlikely to be collected. This is an internal accounting designation designed to give the creditor a tax exemption on the debt. Often, these charged off "bad debts" are then sold to collection agencies.

A charge-off does not free you, the debtor, of having to pay the debt. The debt remains legally valid, and the creditor still has the right to collect the full amount so long as it is within the statute of limitations period.

You typically have 30 days to respond to the summons. An attorney can help you get an extension of time to respond to the summons. An attorney can also help you settle this debt after obtaining the necessary information to verify what amount is actually owed, and to whom. If you don't do anything, the plaintiff will be able to get a default judgment for the full amount of whatever their documentary evidence shows.

Frank W. Chen has been licensed to practice law in California since 1988. The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, consult your own attorney.

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