In May, the U.S. Supreme Court ruled that, using a debtor’s bankruptcy proceedings, debt collectors can collect debts even if they have expired under the state’s statute of limitations. These companies will no longer be held liable under the Fair Debt Collection Practices Act (FDCPA) for filing claims for otherwise-expired debt which isn’t required to be repaid under Illinois law.
Of course, countless professional debt collectors are guilty of “buying” old debts (meaning “to acquire the legal right to pursue”) and filing claims to collect them in the hope that no one will notice that the debt has legally expired by exceeding the statute of limitations. While they would still attempt this practice while it was unlawful, the Supreme Court ruling gives them a green light to pursue all the expired debts they want.
This ruling is especially important if you are considering filing for Chapter 7 bankruptcy: if you enter bankruptcy and a debt collector files a claim against you for an old debt, you need the assistance of an experienced bankruptcy attorney to ensure that you are not a victim of this unethical and borderline-unlawful practice.
If you are struggling financially and considering filing for Chapter 7 bankruptcy, you’re not alone. Contact an experienced bankruptcy attorney today for a free consultation.