How Long Before a Debt Is Uncollectible in Florida?

Anyone who has ever forgotten to pay a bill or dealt with an error in the accounting department of a company has probably, at one time or another, gotten a call from a debt collector.

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You may have heard terms such as ‘credit reports,’ ‘payment plans,’ ‘good faith payments,’ and other types of financial and legal jargon while on the phone with a collector. Some people who receive these calls choose to pay the debt in order to make the calls stop. Others, however, may attempt to evade the debt collectors in hopes that the debt will expire. Neither of these is a good strategy without first making sure the debt is legitimate. 

Below, we’ll talk about how the debt collection process works, when debts can be collected, and how long they stay on your credit report. Lastly, we’ll talk about how credit repair companies in Miami, Floridacan help remove inaccurate items from your credit report so that you can get approved for the loans you need.

How Does Debt Collection Work?

While the process itself is legal so long as rules and regulations are followed, debt collection agencies have only one goal—to collect the money that is owed. They will use any means at their disposal to accomplish this, including phone calls, letters, and lawsuits. 

Debt collectors make their money by either buying debt for pennies on the dollar and attempting to collect it or by signing contracts with financial firms for a cut of the money that is collected on past-due accounts. 

How Long Is a Debt Collectible For?

This is a tricky question that can have several answers. At face value, a debt is collectible forever and a company may continue to contact you regarding any money that is owed. However, there are circumstances where debt collectors may become limited in their legal options. These limitations can also apply to how long negative items can remain on your credit report. 

In the state of Florida, a debt collector or financial institution has five years to file a lawsuit against you in an attempt to obtain a court judgment by the court that equates to an order to repay the debt. The clock starts from either the date the contract was signed or the date the last payment was made, whichever is later. Once the clock expires, there is no legal recourse for them to pursue–they can simply continue to ask you to pay them.

Some debt collection agencies may use unsavory practices in an attempt to reset the clock. This can include asking you to make a good faith payment on the debt to show your willingness to repay, which resets the five-year clock. 

Filing a lawsuit to collect a debt can be expensive—there are lawyers and court fees that must be paid, and this makes filing lawsuits for small debts unrealistic from a financial standpoint. For larger debts, it's cheaper to attempt to collect by calling rather than filing a lawsuit. However, companies don’t want the five-year clock to expire, so they may pursue legal action before the window closes.

Regarding credit reports, a negative item may remain on your credit report for up to seven years. After that, the debt is still collectible so long as someone is willing to pay, but the item will no longer show up on your credit report. This typically helps raise your score so that you can have a good credit score in Florida.

Inaccuracies and False Debts

All it takes is a slip of the finger when typing in a social security number, a name, or a decimal point to set the wheels in motion that will cause a negative item that doesn’t belong to you to show up on your credit report. Rather than attempting to evade the debt collectors and hoping this item will expire, why not just get the inaccuracy removed entirely?

The first step is to get a credit report in Florida and examine it for any inaccuracies. The next step is to find a reputable credit repair company, such as The Phenix Group, to assist in getting the inaccuracy removed. This is done by working with banks, credit reporting companies, and debt collectors to clear your name and remove the inaccuracy, thereby improving your credit score.

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