The statute of limitations governs the length of time a creditor has to sue you over unpaid debt. Once it passes, a creditor cannot win a judgment against you in court if you cite that as an affirmative defense. The specific timeframe varies from state to state and for different types of debt. In Delaware, the statute of limitations remains the same across most kinds of debt, but there are exceptions.
Statute of Limitations for Most Debts
The statute of limitations starts when you fail to make your last payment. In Delaware, it ends three years after this date for most types of debt. This includes promissory notes such as mortgages, and written contracts like medical bills, loans, and bounced checks. It also includes oral contracts, such as agreements to borrow money from family members.
Some debts can be sought in court for longer than Delaware's three-year standard. Revolving credit accounts, such as credit cards, have a statute of limitations of four years. Even that length pales in comparison to judgments, which have a 20-year statute of limitations. These include amounts awarded to creditors, as well as debts like court-ordered child support. Agreements under seal, such as documents signed and stamped by a notary, also are collectible in court for 20 years.
Creditors Can Still Collect
The statute of limitations does not end your commitment to repay the debt. This means creditors can still contact you about the debt and ask you to repay the balance. While they can't sue once the statute of limitations has expired, they can try and get you to take action that will restart the clock and give them another chance to file suit. For example, you can restart the statute of limitations by confirming that the debt is yours, sending in a payment, or simply saying that you intend to pay.
Statute of Limitations Violations
The Fair Debt Collection Practices Act prohibits creditors from threatening a lawsuit once the statute of limitations has passed. If you are threatened by a creditor or debt collector, contact Delaware's State Attorney General’s office, which can inform you of your rights under state law and help you reach the appropriate authorities at the Federal Trade Commission and the Consumer Financial Protection Bureau.
Lauren Treadwell studied finance at Western Governors University and is an associate of the National Association of Personal Financial Advisors. Treadwell provides content to a number of prominent organizations, including Wise Bread, FindLaw and Discover Financial. As a high school student, she offered financial literacy lessons to fellow students.