Statutes of Limitations

Q. I forgot about a debt from 10 years ago. Now they are threatening to sue me. Can they get a judgment after 10 years?

A. The principal statutes of limitation in Illinois are 4 years for the sale or lease of goods (such as a car, and including the obligation to pay for the goods), 10 years for a contract wholly in writing, 5 years for a contract not wholly in writing (such as a general purpose bank credit card), 2 years for bad check penalties, and 3 years for bad checks. These apply prior to judgment. Judgments are enforceable for 20-27 years, with a requirement for revival after 7.

We have obtained a ruling that an equity line of credit secured by your home (HELOC) is governed by the five year statute.  

Mortgages are enforceable for the same period as the underlying debt.

Illinois courts will apply the Illinois statute of limitations unless the "borrowing statute" applies. This basically applies if you lived in another state at the time of default and the limitations period in the other state is shorter.

"Writing" is used in a very technical sense in the statute of limitations, so do not assume that just because some sort of document exists the contract is one wholly in writing.

Store credit cards usable only for the purchase of goods at a single retailer, as opposed to a general purpose credit card, may be treated as 4 years (litigation is pending on this).

While the statute of limitations on a bad check is 3 years, there may be a longer period of limitations on the underlying transaction, depending on what it is.

There are no statutes of limitation on federal student loans. Private student loans are subject to the 5 or 10 year statute, depending on the documentation.

The statutes are measured from the later of default, last payment or last transaction.

In some cases, there are provisions for extension of the statute. For example, if you file a Chapter 13 that is late dismissed, the period during which the creditor is enjoined from collecting by the automatic stay is not counted.

There is also a special extension provision where the Government (usually the Federal Deposit Insurance Corporation) takes over a financial institution. The Illinois Appellate Court has held that it applies to entities that buy the debts of a failed financial institution from the Government.

Not only is the statute of limitations a defense, but attempts to collect time-barred debts often violate the Fair Debt Collection Practices Act. There may be a violation if they sue, refer to a lawsuit in a letter or call, seek partial payment, or offer a “settlement.”

We can help you both defend claims against you and assert your rights under the Fair Debt Collection Practices Act and other laws. This is a technical area of the law, where the assistance of counsel is really necessary. Edelman, Combs, Latturner & Goodwin, LLC represented consumers in many of the leading cases addressing these issues.

Please contact us if you are facing collection activity . The 12 attorneys in our firm have a total of more than 100 years experience handling consumer lawsuits. We look forward to hearing from you about any consumer legal problem you wish to discuss.

We make no charge for consultation.

We have defended consumers in Cook, DuPage, Kane, Will, McHenry, Kendall, Grundy, Lake, DeKalb, Kankakee, Carroll, Clinton, Winnebago, Bureau, LaSalle, Boone, McDonough, Rock Island, Knox and Whiteside Counties, Illinois.

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