When you fail to make a payment on a credit card, your account goes into default. This means that you are no longer current and now you have an overdue debt. Your creditor can take you to court to make you pay the debt. However, there is something called the statute of limitations in Maryland, which Money Management International explains is the time limit on how long the creditor has to take you to court for a debt.
Once the statute of limitations runs out, a creditor does not have the right to sue you. However, it can still try to collect the debt and can take you to court. You must show up to court and prove the time limit has run out on the creditor’s legal right to sue you. If you do not show up, the court will likely rule in favor of your creditor.
The time limit begins once you miss a payment. How long the time limit is depends on the type of debt. For written debts, such as a loan, it is three years. The same time limit applies to open-ended debts, such as credit cards and to oral debts. Promissory debts have a statute of limitations of six years.
Understanding the time limit can help you know your rights. While this time limit for creditors ability to sue you is under three years for credit cards, that does not mean the debt will not impact your credit. In fact, the debt will stay on your credit report for seven years. This information is for education and is not legal advice.
