Pursuant to California Code of Civil Procedure § 337, the statute of limitations for debt related to a written contract is four years, and an oral contract is two years from the date of breach.
If your vehicle was repossessed more than four years before a debt collector files a deficiency lawsuit, the four-year statute of limitations for breach of contract can bar the debt collector's claim. However, the statute of limitations is not an automatic defense. You as the consumer must appear and bring that issue to the court's attention. (Likewise, the debt collector can call you without filing a lawsuit to see if you will pay.)
The statute of limitations on a car contract is four years from date of last payment or breach of contract, whichever is later. Collection calls may continue past the statute of limitations, but the collector may not threaten to sue you or garnish your wages, unless they filed the lawsuit several years ago. If you are sued now, more than four years after the repossession, you need a lawyer to defend you in that case, as they may have violated the debt collection laws that protect you from untimely lawsuits.
In the second link, below, are sample letters that you can use to dispute the debt. If you dispute it or timely ask for verification, then the calls must stop until they verify the debt.
The first thing you need to do if and when you get sued is file an Answer. The summons will tell you that you must “appear” by way of an Answer in 10, 20 or 30 days, “depending on the method of service.”
PLEASE CHECK THE LAW IN YOUR STATE AS YOU MAY ACTUALLY HAVE TO APPEAR IN COURT, AS IN VIRGINIA, IN ORDER TO AVOID A DEFAULT!
You need a lawyer, but if you cannot afford one right away, rather then do nothing and have a judgment entered against you, is to “appear” by filing something!
Many people think this means they have to go to Court and this is incorrect. 90% of all lawsuits end in Default Judgments because the defendant (person getting sued) did not file an Answer.
I recommend you go to the free form I have on my website. Print it out and fill it out as instructed. You must answer the numbered paragraphs on the Complaint by writing them into the appropriate lines in the Answer. The Answer will allow you to preserve your rights and will prohibit a default judgment (i.e. you did not show up) from being entered against you.
Mimic the paperwork you got when you got sued. Answer all the paragraphs of the Complaint by writing the numbers in lines 1, 2 or 3.
Almost 100% of attorneys will deny what is owed because they did not do the calculations and do not know what the basis for the number is…
When you file the Answer that is your “not guilty”. You have the right to make the person suing you (Plaintiff) prove their case, but you must also answer the complaint truthfully.
Make sure you fill in the name and address of the attorney suing you before you bring this paperwork to the Court. Mail it to the attorney suing you right away!
Check out the guide I have drafted on the Avvo profile. This will provide more detailed instructions. If it is helpful remember to indicate that and get the guide read!
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Disclaimer: This answer does not constitute legal advice. I am admitted in the States of New York, New Jersey and Massachusetts only and make no attempt to opine on matters of law that are not relevant to those three States. This advice is based on general principles of law that may or may not relate to your specific situation. Facts and laws change and these possible changes will affect the advice provided here. Consult an attorney in your locale before you act on any of this advice. You should not rely on this advice alone and nothing in these communications creates an attorney client relationship. The opinions expressed herein are those of the author only and the fact that he has worked as an Assistant District Attorney; State Supreme Court Clerk; Special Assistant United States Attorney (Hawaii); Assistant Cornell University Counsel or Judge Advocate, United States Marine Corps should not be relied upon to assume that these statements reflect the policy of these organizations.