Debt Collectors, Charge-Offs and Old Debt: Your Rights and What to Do

A letter or call from a debt collector is stressful, especially when the debt is old or you do not recognize it. Federal law gives you specific rights: to get details about the debt, to dispute it, to limit calls, and to be free from threats and lies. This guide walks through charge-offs, credit reporting, those rights, old debts and the statute of limitations, and what to do if a collector sues.

---

The Short Answer

• A charge-off does not cancel the debt. It is the lender writing the loan off its books, usually after 180 days past due on a credit card. You can still be asked, and sued, to pay it.
• A charge-off or collection account can stay on your credit report for 7 years, counted from 180 days after the delinquency began. Paying it does not restart that clock.
• You have about 30 days to dispute. Dispute in writing within the validation period on the collector's notice, and it must pause collection until it sends verification.
• Collectors are presumed to break the law if they call more than 7 times in 7 days about one debt, or call again within 7 days after you talked with them.
• Old debt can be "time-barred." Each state sets its own statute of limitations, often 3 to 6 years. Collectors cannot sue or threaten to sue on a time-barred debt, and in some states a small payment can restart the clock.
• Never ignore a lawsuit. If you do not respond by the deadline, the court can enter a default judgment, which can lead to wage garnishment or a frozen bank account.

---

What a Charge-Off Means

A charge-off is an accounting step taken by the lender, not a decision about whether you owe. Under the federal banking regulators' retail credit policy, banks should charge off open-end accounts such as credit cards once they are 180 days past due, and closed-end loans such as personal loans at 120 days. The lender records the balance as a loss.

After that, the debt still exists. The lender may keep collecting it itself, hand it to a collection agency, or sell it to a debt buyer. The charged-off account, and any collection account, can stay on your credit report for years, as explained below.

---

How Long a Charge-Off Stays on Your Credit Report

The Fair Credit Reporting Act bars credit bureaus from reporting accounts "placed for collection or charged to profit and loss" that are more than seven years old (15 U.S.C. 1681c). The law also fixes when those seven years start: at the end of a 180-day period that begins on the date the delinquency began, meaning the missed payment that led to the charge-off or collection.

Hypothetical example: if your first missed payment that you never caught up was due on March 1, 2026, the 180-day period ends in late August 2026, and the seven years run from there. The item should drop off around late August 2033, roughly seven and a half years after the missed payment.

A few points people often get wrong:

• Selling the debt does not reset the date. The clock is tied to the original delinquency, not to when a new collector got the account.
• Paying or settling does not reset it either. The entry can be updated to show it was paid or settled, but the end date stays the same.
• There are exceptions. The seven-year limit does not apply to reports used for a loan of $150,000 or more, life insurance of $150,000 or more, or a job paying $75,000 or more a year.
• Court judgments follow a different rule: seven years from entry or until the statute of limitations on the judgment expires, whichever is longer.

If an old account is still showing after its end date, or the dates look wrong, you can dispute it with the credit bureau. Our guide to checking your credit report for errors explains how, and what counts as a good credit score shows where you stand.

---

When Your Debt Is Sold

The CFPB explains that creditors can collect in-house, refer a debt to an outside collector, or sell it to a debt buyer, who then collects it directly or through other collectors. That is why a company you have never heard of may contact you about an old credit card.

The federal Fair Debt Collection Practices Act (FDCPA) mainly covers third parties: collection agencies, debt buyers and collection law firms collecting debts owed to someone else (15 U.S.C. 1692a). A creditor's own employees collecting in the creditor's name generally are not "debt collectors" under it, although state laws may still apply to them. The FTC notes the FDCPA covers personal and household debts such as credit cards, car loans, medical bills, student loans and mortgages, not business debts.

A sale does not take away your defenses. A collector may not falsely claim that a transfer of the debt means you lose any claim or defense, and a collector may not sell or place for collection a debt it knows was paid, settled or discharged in bankruptcy (with narrow exceptions).

---

The Validation Notice and Your 30 Days

The CFPB's debt collection rule, Regulation F (12 CFR part 1006), requires a collector to give you "validation information" in its first communication or within five days after it. The notice must include, among other things:

• the collector's name and the mailing address where it accepts disputes;
• the creditor on the "itemization date" (a reference date such as the charge-off date or last payment date), the account number, and who owns the debt now;
• the amount on the itemization date, an itemized list of interest, fees, payments and credits since then, and the current amount;
• the date the collector treats as the end of your validation period, and how to dispute or ask for the original creditor's name and address.

The validation period ends 30 days after you receive the information. The collector may assume you received it five days after sending it, not counting weekends and federal holidays, so the end date printed on the notice is usually a little more than a month after the notice date. Use that printed date as your deadline.

Within that period, a written dispute or a written request for the original creditor's name and address makes the collector stop collecting (the disputed part, for a dispute) until it mails you verification, a copy of a judgment, or the original-creditor information. If you do nothing, the collector will assume the debt is valid. Not disputing is not a legal admission that you owe, though.

---

How to Dispute a Debt in Writing

The FTC suggests sending the letter within 30 days, by certified mail with a return receipt, and keeping a copy. Many validation notices also include a tear-off dispute form, and some collectors accept disputes online. The CFPB offers sample letters you can adapt. A simple outline:

1. Your details: name, mailing address, and the reference or account number from the collector's notice (not your full Social Security number).
2. The collector's details: name and the dispute address printed on the notice, and the date of its letter.
3. What you dispute: say plainly that you dispute the debt, all of it or a stated part, and why if you know (not my account, already paid, wrong amount, discharged in bankruptcy).
4. What you ask for: verification of the debt, and the name and address of the original creditor.
5. Optional limits: how you want to be contacted (for example, mail only, no calls at work).
6. Close: date and signature. Do not admit the debt or promise any payment in the letter.

This outline is for information only. If the amount is large or you think you are being sued, a consumer attorney or legal aid office can check your letter.

---

What Debt Collectors Cannot Do

Regulation F spells out many of the FDCPA's limits. The main ones:

• Call too often. A collector is presumed to comply if it calls you about a particular debt no more than 7 times in 7 consecutive days, and not at all for 7 days after a phone conversation with you about it. Going over either limit is presumed to be a violation (12 CFR 1006.14). The count is per debt, so several debts can mean more calls.
• Contact you at bad times or places. Unless it knows otherwise, a collector must treat calls before 8 a.m. or after 9 p.m. your local time as inconvenient. It cannot contact you at work if it knows or has reason to know your employer forbids it, and if it knows a lawyer represents you on the debt, it generally must deal with the lawyer (12 CFR 1006.6).
• Keep contacting you after you say stop. If you write that you refuse to pay or want contact to stop, the collector must stop, except to confirm it is ending its efforts or to tell you about a specific step it may take, such as a lawsuit. Stopping contact does not erase the debt.
• Harass or abuse you: no threats of violence, no obscene or profane language, no publishing lists of people who "refuse to pay."
• Lie: no pretending to be a lawyer, a government agency or a credit bureau, no misstating the amount or legal status of the debt, and no threats of arrest, jail, garnishment or seizure that are not lawful or not actually intended (12 CFR 1006.18).
• Add charges or embarrass you: no interest or fees unless your contract or the law allows them, no postcards, no debt-collection wording on envelopes, and no public social media messages about the debt (12 CFR 1006.22).
• Report the debt before contacting you. A collector must speak with you or send you a letter or electronic message (and wait a reasonable time for a bounce-back) before furnishing the debt to a credit bureau.

Every email or text from a collector must also tell you a simple, free way to opt out of electronic messages to that address or number.

If a collector breaks the FDCPA, you can sue it within one year of the violation for your actual damages, up to $1,000 in additional damages, and court costs and attorney's fees (15 U.S.C. 1692k).

---

Statute of Limitations on Debt

A statute of limitations is the time limit, set by state law, for a creditor or collector to sue you over a debt. Once it runs out, the debt is "time-barred." The debt does not disappear: collectors can still ask you to pay, by letter or phone, within the rules above. What changes is the lawsuit. Regulation F says a collector "must not bring or threaten to bring" a legal action to collect a time-barred debt (12 CFR 1006.26(b)). Proofs of claim in a bankruptcy case are excluded.

How long is it? The CFPB says most states set limits of three to six years for debts, with some longer. The period can depend on the type of debt, the state where you live, and the state law named in your credit agreement. Some debts, such as federal student loans, have no statute of limitations at all.

When does it start? In some states the clock starts when you miss a required payment; in others it runs from your most recent payment, even one made during collection.

Can it restart? Yes, in some states. The CFPB warns that a partial payment, or acknowledging that you owe an old debt, may restart the period, even after it has expired. The FTC gives the same warning about a payment or a written acknowledgment. That is why it matters to know where an old debt stands before you send any money.

Statute of limitations vs. the 7-year credit report period

These are two separate clocks. The statute of limitations (state law) decides how long you can be sued. The seven-year rule (federal law) decides how long the debt can appear on your credit report. A debt can be too old to sue on but still on your report, or still on your report after you have paid it. Paying or acknowledging an old debt may restart the lawsuit clock in some states, but it does not extend the credit report period.

Statute of limitations by state: how to find yours

We have not published a 50-state table here, because limits differ by type of debt and contract, and we could not source every state from its own statute for this guide. To find yours:

• contact your state attorney general's office or a local legal aid office, as the FTC suggests;
• look up your state's civil code section on limitations of actions (often titled "limitation of actions" or "time for commencing actions") for written contracts and open accounts;
• check which state's law your card agreement names.

The CFPB suggests talking to a lawyer to work out the exact date for your debt, because the start date and restart rules vary.

---

If You Are Sued

The CFPB's advice is to respond to the lawsuit by the date in the court papers, yourself or through a lawyer. Responding does not mean you agree you owe the debt; it makes the collector prove its case.

• If you do not respond, the court can enter a default judgment for the amount claimed, plus allowed interest, collection costs and attorney's fees.
• A judgment gives the collector stronger tools. Depending on your state's law, it may be able to garnish your wages, put a lien on your property, or freeze money in your bank account.
• Raise the statute of limitations yourself. Suing on a time-barred debt violates federal law, but the CFPB notes a court may still enter judgment if you do not show up and raise the defense.
• Get help. Legal aid offices and attorneys who handle FDCPA cases can help; some work for free or reduced fees. Servicemembers can use their JAG legal assistance office.

Garnishment usually needs a judgment first. For ordinary consumer debts, the FTC says a collector must sue and get a court order before taking money from your paycheck or bank account. Federal law caps ordinary wage garnishment at the lesser of 25% of your weekly disposable earnings or the amount above 30 times the federal minimum hourly wage (15 U.S.C. 1673); support orders, bankruptcy court orders and state or federal tax debts are outside that cap. Many federal benefits, including Social Security, SSI and VA benefits, are generally protected from garnishment except for taxes, child or spousal support, and student loans.

---

Medical Debt

Medical debt in collection is covered by the same FDCPA and Regulation F protections. In January 2025 the CFPB finalized a rule to keep most medical debt off credit reports, but on July 11, 2025 a federal court in Texas vacated it, at the joint request of the CFPB and the plaintiffs, and the CFPB now lists the rule as reference only. Under the FCRA, medical debt can be reported as long as it does not identify the provider or the kind of care. Your state attorney general can tell you whether your state adds its own protections.

---

Negotiating a Payment or Settlement

If the debt is yours and within the statute of limitations, the CFPB's steps are to confirm you owe it, work out what you can really afford each month (or in a lump sum), and then make a proposal. Some practical points:

• Get it in writing before you pay. The agreement should state the amount, the payment dates, and that the payment settles the whole debt. The FTC recommends a signed letter saying you will owe nothing more, and keeping records of every payment.
• Check the old-debt question first. On a time-barred debt, a partial payment can revive it in some states and expose you to a suit for the full balance.
• "Pay for delete" is not a right. Paying an old debt may not remove it from your credit history, and some collectors report a settled debt as settled for less than the full balance. If a collector offers to delete an entry, get that promise in writing too.
• Direct your payments. If one collector has several of your debts, you can tell it which debt a payment goes to.
• Be careful with debt settlement companies. The CFPB warns that some promise more than they deliver. See when debt settlement makes sense.

If you have several debts, a nonprofit credit counselor, a consolidation plan or a structured snowball or avalanche payoff may work better than settling one account at a time. Our debt-to-income calculator shows how much of your income your payments take now.

---

Fake Debt Collectors

Not every caller who says you owe money is a real collector. The FTC's warning signs of a scam:

• they ask you to pay a debt you do not recognize;
• they will not give you a mailing address or phone number;
• they pressure or scare you, for example by threatening to report you to the police or have you arrested.

Do not give out personal or financial information until you have the written validation information or already know the collector. Look up the original creditor's phone number yourself and ask whether the debt was sold, and to whom. If a caller threatens to have you arrested, suspend your driver's license or call your employer, the FTC's advice is to hang up and report it.

---

Where to Complain

• Consumer Financial Protection Bureau: consumerfinance.gov/complaint.
• Federal Trade Commission: ReportFraud.ftc.gov, including for fake collectors.
• Your state attorney general: many states have their own debt collection laws that go further than federal law; find your AG.

Keep copies of letters, the dates and times of calls, and any voicemails. Those records help whether you complain, dispute, or talk to a lawyer.

---

FAQ

Do I still owe a debt that was charged off?
Yes. A charge-off is the lender writing the balance off as a loss in its own accounts. The debt still exists and can be collected or sold, and you can be sued over it until the statute of limitations runs out.

How long does a charge-off stay on my credit report?
Up to seven years, counted from the end of a 180-day period that starts when the delinquency began. In practice that is about seven and a half years after the missed payment that led to the charge-off. Paying it does not change the date.

What is the statute of limitations on credit card debt?
It depends on your state and sometimes on the state named in your card agreement. The CFPB says most states use three to six years for debts, and some are longer. Your state attorney general or a legal aid office can tell you the rule that applies.

Can a debt collector sue me for a debt older than the statute of limitations?
No. Federal rules ban suing or threatening to sue on a time-barred debt. If it happens anyway, respond to the lawsuit and raise the statute of limitations, because a court may still enter judgment if you do not.

Will paying an old debt restart the clock?
In some states, yes: a partial payment, or even acknowledging the debt, can start a new limitations period. It does not restart the seven-year credit report period.

How many times can a debt collector call me?
A collector is presumed to break the rules if it calls about one debt more than 7 times in 7 days, or calls within 7 days after speaking with you about it. Calls before 8 a.m. or after 9 p.m. your time are presumed inconvenient.

How do I make a debt collector stop contacting me?
Send a letter saying you want it to stop contacting you. It then may only contact you to confirm it is stopping or to tell you about a specific action such as a lawsuit. You may still owe the debt, so dispute it first if you think it is wrong.

Can a debt collector garnish my wages without going to court?
For most consumer debts, no. The collector must sue and win a court judgment first. Support orders and tax debts follow different rules.

This article is for general information and is not legal or financial advice. Rules are from Regulation F (12 CFR part 1006, eCFR) and the FCRA and FDCPA (15 U.S.C. 1681c, 1692a, 1692k, 1673), read on 2026-10-27; consumer guidance from the CFPB and FTC and the CFPB's medical debt rule status, read on 2026-10-27; charge-off timing from the federal banking agencies' Uniform Retail Credit Classification policy (65 FR 36903). The credit report example is hypothetical. Statutes of limitations are set by each state; check your state's law or ask a lawyer about your own debt.