Why bother?

[longsally111]

What is the name of your state (only U.S. law)? South carolina

here is my question and it is simple. Why do people continue to send letters and bother you for stuff that is outside the sol? They can sue but they would lose and it would only cost them money. If they have a certain amount of time to take legal action and they chose not to, why bother you 7-10 years down the road when the sol ran out after 3 years and that was over 3 years ago? DUH

( waiting with baited breath for dc's response)

 

[TigerD]

What is the name of your state (only U.S. law)? South carolina

here is my question and it is simple. Why do people continue to send letters and bother you for stuff that is outside the sol? They can sue but they would lose and it would only cost them money. If they have a certain amount of time to take legal action and they chose not to, why bother you 7-10 years down the road when the sol ran out after 3 years and that was over 3 years ago? DUH

( waiting with baited breath for dc's response)

Because 5 to 18 percent of those people pay.

DC

 

[ecmst12]

Because you still owe the debt and they can ask you to pay it as many times as they like.

 

[longsally111]

imagine how much money they waste on paper, envelopes, stamps, tracking you down, etc.. Why dont people go after the debtors when the money is due, within the sol?

 

[Zigner]

imagine how much money they waste on paper, envelopes, stamps, tracking you down, etc.. Why dont people go after the debtors when the money is due, within the sol?

In addition to the people that pay (you know, the ones who honor their commitments, albeit a bit late), you have the people who fail to respond to a law suit and lose by default.

 

[Country Living]

If I may be allowed to tag along in the pondering.... why does moving from one state to another state "toll" the debt? It's not like it was 40 years ago when it was harder to track down someone. Does it really suspend the SOL in today's environment? Has anyone successfully argued this point in court - either for or against?

 

[cyjeff]

Also, let's not forget that these secondary and tertiary companies bought the debt for, what, three cents on the dollar?

That means that 5-18% means a huge profit.

 

[Chien]

Originally Posted By Country Living
Why does moving from one state to another state "toll" the debt? Does it really suspend the SOL in today's environment? Has anyone successfully argued this point in court - either for or against?

A bit off-track for the post but the issue has been debated in this forum ad nauseum and, having participated in some, I’m the last one to want to re-open the debate. The short answer is that courts have split, with successful and unsuccessful arguments having been made for specific fact patterns. Use the “search” function and spend a day reading.

Some states have codified specifically what is required to toll the Statute (NY, if memory serves, specifies absence from the state for 6 months). Others treat establishing residency as tolling the old Statute. In today’s environment, more courts appear to be favoring a “cannot be found with reasonable due diligence” approach to a “crossing the state line” approach. Debt Guy has expressed a preference for a Uniform Statute of Limitations, which would help solve the problem.

 

[Chien]

Originally Posted By longsally111
Why don’t people go after the debtors when the money is due, within the sol?

It’s a legitimate question with many possible answers ranging from poor business planning on the part of the creditor to creditors that routinely dispose of debt by quick referral to an inept agency or that have credit insurance or that factor debt. Action by the credit insurer or the factor will be slower than direct action by the creditor and there is a greater chance that uncollected debt will be re-sold by the insurer or by the factor-without-recourse.

We all know that collectibility declines linearly over time, and no ARM professional encourages “just sitting”, but slower collections can also be a function of an industry business model. I don’t believe that exceedingly slow collection activity is as prolific as posts in this forum might suggest, and I know that the industry presence of debt buyers is not as pervasive as posts suggest.

I suspect that current economic conditions may make for some increase in delayed collections, because businesses will go under and outstanding A/Rs will fall into the hands of bankruptcy trustees and assignees for the benefit of creditors and then be referred for collection. As yet, that’s untested personal speculation.