Credit and Debit Cards
Debt Collection
Statutes of Limitations

Does the statute of limitations on a debt starts from the date of last activity or from the charge off date?

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Wiki User
2011-09-13 00:47:13

Statute of Limiations does NOT mean the debt can't be collected

or is no longer due. It simply means that they cannot use the

courts to get a judgment to collect it.

The charging or writing off of a debt is only a required

accounting entry by the creditor.

It does not effect you, or change the amount you owe, or that

you owe it.

It does not change any of the legal methods to force collection

that were available before making the entry.

It does not change any of the creditors rights, or change your

obligation in it. The debt is NOT forgiven.

All it does is make the creditors accounting statement recognize

that an asset (your receivable) that it expected to realize, and

already recorded as income, is not going to happen. they are taking

the charge to their books for the expense of your not paying, or

that it is now considered unlikely you will ay, and the asset does

not exist (or in bank terms, is no longer productive).

When the charge off occurs depends on many things in accounting

parlance...most companies actually establish an account for

expected bad debts (an accrual) as a current charge against sales,

(expecting some to go bad), and adjust that account on

experience...without having to do much on any particular


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