Information About Credit Card Debt

For any credit card user, knowing your rights as a debtor is important. Credit card debts are covered by several important state and federal laws and regulations, which govern how debt can be collected, what limits there are on methods of collection, and how long the debts can last.

TIme Limits on Credit Card Debt

Each state sets a limit for how long a creditor can collect a credit card debt. While the limits vary widely by state (usually between three and 10 years), if a creditor has not collected or filed a lawsuit before the statute of limitations runs out, it cannot collect. It can file a lawsuit after that time, but if the debtor can show the statute of limitations has expired, the suit will be dismissed.

Time Limits on Judgements

Similarly, judgments on debts are also covered by statutes of limitations. The law imposes time limits (between three and 20 years) on how long a judgment can be collected. This means that even if a creditor files a lawsuit and wins, his right to collect on the judgment cannot be pursued after the statute of limitations has expired.

Communications

The Fair Credit Collections Practices Act is a federal law that regulates how credit card issuers can pursue card holder debt. In general, the law prohibits issuers (or collections agencies working on their behalf) to act in a threatening, intimidating manner, or otherwise harass a debtor. Issuers cannot call before 8 a.m. or after 9 p.m., and cannot contact a third party who does not owe the debt.

Interest Rates

Under the CARD Act of 2009, credit card issuers cannot raise interest rates unless the card was issued with a temporary promotional rate, as a variable interest rate card, or if the holder has been late for more than 60 days on a payment. Further, the dates on which payments are due must be at least 21 days after the bill has been mailed, and the time cannot be earlier than 5 p.m.

Credit Report Rights

Credit card debts can lead to changes in your credit report, though you do have the right to change these or dispute them. Under the Fair Credit Reporting Act, every consumer is allowed to yearly free inspection of her credit report. If there are errors on the report, the consumer can demand that the credit reporting agency change or remove them. If it refuses, the cardholder can add a consumer statement to the report, detailing the reasons the item is disputed. This statement will appear on the report, and anyone inquiring into the person's credit history will see it.