Kentucky has a 15 year statute of limitations for written contracts UNLESS you have paid on it. Making any payment within the statutory number of years re-sets the statute for another 15 years. Some states have this rule in their Statute of limitations. Other states don’t. If a collector is pestering you about a 16 year old debt, and you have not paid 16 years, tell them that the debt is beyond the statute of limitations and they must stop contacting you about it altogether, effective immediately.
Student Statute of Limitations for Student Loans
Collectors will record the calls so the information you give to them can be used in court against you later. It is rare when calling a collector will benefit you. Never admit liability during the phone call. It can be used to prove you owe the debt in a student loan lawsuit later.
If the third-party collector does not immediately leave you alone, keep copies, tapes, and any records of their continuing attempts, and sue them under the Fair Debt Collection Practices Act. The Fair Debt Collections Practices act requires
- The debt to be a consumer debt
- The debt must be in default.
- The collector is collecting for the debt of another party.
- The collector must treat you truthfully and with respect.
Paying the debt after it has been charged off and enters collections generally does not improve your FICO score. The only exception to this is when a student loan is rehabilitated under the Department of Education DOE rehabilitation program.
With private student loans the loan is in default when it is overdue. For government student loans it is not in default unless it is over 270 days overdue. Until then it is normally only being serviced. After 270 days it is in the hands of a collector and in collections. There is no statute of limitations for most government student loans. Some student loans are dischargeable in bankruptcy when you leave the school or after 5 years. You have to know who issued the student loan to find the exceptions to whether a 5 year rule applies to bankrupting the debt or whether you have to use the undue hardship standard.
Normally student loans are never dischargeable. The statute of limitations only applies to private student loans. The statute of limitations for each state applies to the residents of that state. Whether or not making any payment resets the statute of limitations is a matter of the law for the state you are in. For some people moving to another state to defeat a private debt is an option. If you have a student loan read the main pages on our website to understand how the time limits apply to student loans to discharge some of them in bankruptcy.
Resources for Student Loans
Student Loan Statute of Limitations • Video
How to Stop Federal Student Loan Wage Garnishment • Video
Kentucky’s 60-Year Statute of Limitations for Debt Collection • Video
History of Student Loans in Bankruptcy
What is the Student Loan Brunner Test?
Student Loan Bankruptcy Qualifications
Do you need help managing your student loan? Contact my office right away to start the conversation. Nick C. Thompson, Attorney: 502-625-0905
