Arkansas has laws designed to help creditors and other interested parties collect delinquent debts. However, the statute of limitations prevents creditors from taking legal action against a debtor after a specified period of time. This time varies depending on the type of debt. Even when the statute of limitations is reached, it doesn't erase all records of the debt.
Statute of Limitations
Under Arkansas state regulations, you have just three years to pursue debts and obligations based on oral agreements. These may include rent payments, or money owed for goods and services. The statute extends to five years for written contracts such as mortgages, car notes or lease agreements. Crucially, the five year period resets whenever you make a partial payment or provide a written acknowledgement of the debt. Effectively, the statute of limitations is based on the last activity related to the debt rather than the missed payment due date.
Credit cards fall into a grey area under state laws, because you receive a written contract with your card but you don't have to sign it. In the absence of clear guideline, judges in Arkansas and many states have been forced to interpret the law with regard to credit card debt. In a 2010 case, an Arkansas judge ruled that credit card debts are covered by written contract law because the cardholder's agreement with the contract terms is assumed upon acceptance of the card.
Chapter 56 of the Arkansas legal code includes a subsection dealing specifically with medical bills. Prior to April 1985, medical practitioners and providers had just 18 months to collect past due debts. For debts incurred after that date, the statute of limitations has been extended to two years. As with written contracts, the statute of limitations is reset whenever you make a partial payment. The statute could be extended for several years if you enter into a periodic payment agreement.
The statute of limitations for any type of debt is extended to 10 years if you obtain a court judgement. The courts have the authority to garnish wages and bank accounts of the debtor. The Arkansas court system can also get involved in cases involving bad checks. Written or oral contract laws would apply to the collection of the actual debt you attempted to pay with the bad check. The act of writing a bad check can also lead to a fine of between $30 and $50, plus damages and attorney fees. Depending on the amount involved and the frequency of the crime, writing a bad check can be classified as a felony or a misdemeanor.
- US Justia Law: Arkansas Code; Notes and Instruments in Writing and Other Writings
- US Justia Law: Arkansas Code; Actions With Limitation of Three Years
- US Justia Law: Arkansas Code; Recovery of Charges for Medical Services
- Federal Trade Commission: Time Barred Debts
- The National List of Attorneys: Arkansas Debt Collection Laws
- U.S. Department of Labor. "Garnishment." Accessed Oct. 19, 2020.
- Federal Trade Commission. "Time-Barred Debts." Accessed Oct. 19, 2020.