The Statute of Limitation on Debt in Ohio

If you live in Ohio and have old debts, the statute of limitations could be your ally. There are some important things to know about the state law and how you can avoid paying off a debt that is too old to be collected.

What is the Statute of Limitations?

The statute of limitations for debt is the period during which a creditor or debt collector is legally entitled to pursue collection actions against you for an unpaid debt. A debt is considered “old” and past the statute of limitations when creditors or debt collectors are no longer legally allowed to file a lawsuit against a debtor to collect a debt.

Statutes of limitations are established to protect debtors from being exposed to debt collectors or creditors for a specific length of time and prevent those debtors from being exposed to legal actions for old debts.

What Is the Statute of Limitations on Debt in Ohio?

In Ohio, the statute of limitations for debt collection depends on the type of debt involved. The following list establishes the statute of limitations for the most common types of debts:

• Written Contracts: if there is a written agreement or contract outlining the terms and conditions, the statute of limitations is 6 years. This includes debts in writing such as personal loans or credit card debts.

• Oral Contracts: if it is not a written agreement or contract but there is evidence of a verbal agreement, the statute of limitations is 6 years. This includes debts that are based on oral agreements.

• Promissory Notes: if there is a promise (express or implied) to pay a specific amount of money by a certain date, the statute of limitations is 6 years.

• Open-ended Accounts: if there are other open-ended accounts where there is no specific written agreement, the statute of limitations is 6 years.

For more information visit https://codes.ohio.gov/ohio-revised-code/chapter-2305

When The Statute of Limitations for Debt Starts in Ohio?

According to the Ohio Code, Section § 2305.07, https://codes.ohio.gov/ohio-revised-code/section-2305.07, the statute of limitations involving a debt collection starts after 30 calendar days from the date of the last charge or payment made by the debtor. In other words, the statute of limitations begins 30 business days after you made your last payment or when your debt became overdue, whichever is later.

May The Statute of Limitations for Debt Restart in Ohio?

The six years statute of limitations in Ohio restarts if you acknowledge the debt to your creditors or debt collectors. You may be acknowledging the debt (1) if you make any payment, (2) if you sign an agreement stating that you are willing to pay the debt, or (3) if you even agree with the debt collector or creditor during a phone call that you owed a specific amount of debt. However, in Ohio, if the statute of limitations for your debt has passed and you have not acknowledged said debt in any form within the six-year statute of limitations time, you may be safe from restarting the clock of the statute even if you acknowledge the debt later.

Also, it is important to know that in many states, if a debtor makes a partial payment to an old debt that has passed the statute of limitations, the debtor will automatically “revive” the debt and the clock will start to tick again. However, according to the Ohio Supreme Court, in Taylor case, partial payments made to credit cards may not alter the running of the statute of limitations that began when the debtor missed the first monthly payment and their credit card’s balance was overdue. You can read the decision here, https://www.supremecourt.ohio.gov/rod/docs/pdf/0/2016/2016-Ohio-3444.pdf

Attorney Mathew Higbee, who represents consumers who are under financial hardships advises that “debtors need to keep in mind that the statute of limitations may change over time in each state, and it is crucial to be aware of any legal modification that may affect the debtor’s specific situation.” In any case, “it is important to get legal advice to protect yourself to avoid serious financial consequences”, he said.

The best way to properly deal with your debt and protect yourself is to speak with one of our experienced debt solution attorneys. At Advantage Law we have a dedicated team that will help you with your situation.