Statute Of Limitations On Debt Collection In Alabama

If you are like many Americans in Elmore County, Alabama, you are living with a significant amount of debt. Credit card debt recently topped $1 trillion in the United States, for instance, and many Americans live paycheck to paycheck. Much of the time, this debt is largely out of people’s hands. It comes from unexpected expenses, medical bills, job loss and income reduction.

If you find yourself in this position, it is important to work with an experienced Elmore County bankruptcy attorney. That’s why you need to call us at the Law Office of Jeffrey J. Courtney, LLC. We have more than three decades of experience, so you get a lawyer who understands exactly what steps to take and what options you have. We prioritize communication, and we are highly dedicated to our clients. Call us today to set up your initial consultation.

How Long Do Creditors Have To Make A Claim In Alabama?

There is a statute of limitations on debt collection in Alabama, meaning that collectors only have so long to take action against you. As soon as you miss a payment, the timeline starts. It is very important to know how these deadlines work, and they depend to some extent on the specific type of debt that you are facing.

For example, if the issues are with mortgage debt or outstanding medical debt, then the statute of limitations is six years. For auto loans or credit cards, though, there is a shorter statute of limitations that usually falls between three and four years. If you are dealing with state taxes, the state has much longer to collect, as the statute of limitations is 10 years.

Can Bankruptcy Be Used To Relieve Old Debts?

There is no statute of limitations regarding when you can file for bankruptcy in Alabama. Bankruptcy is simply a legal tool that you can use to alleviate some of this debt. You can consult with an Elmore County bankruptcy lawyer to determine when it would be the best option for you, depending on the type of bankruptcy you want to use and the specific debts that you are facing.

That said, you may start to consider bankruptcy because someone else has a judgment against you. In that case, there may be a statute of limitations of 10 years on that judgment. But you are still free to use bankruptcy, which puts an automatic stay on collection efforts and other financial cases that are pending against you.

What Are Your Options Against Debt Collectors In Alabama?

The specific options you have depend on the type of debt you are trying to address. For instance, if it is tax debt, the IRS may allow you to use a structured repayment plan, or you may be able to use an offer in compromise, allowing you to pay off a portion of the tax debt and have the rest forgiven.

If you decide to file for bankruptcy, the first option is to use Chapter 7. You have to liquidate nonexempt assets – but there are many exemptions for things like your home, your primary vehicle or your tools of the trade – and use the proceeds to pay off a portion of the debt. The remaining debt is then forgiven.

Another option is to use Chapter 13 bankruptcy. This also creates a repayment plan, typically lasting 3 to 5 years. The benefit is that it consolidates your debt so that it is not due immediately, spreading out the financial obligation. This is often referred to as “wage earner’s bankruptcy” because someone who still has an income may be able to pay their debt off under a repayment plan, even if it is unaffordable in its current structure.

What Can A Bankruptcy Attorney Do For You In Elmore County?

Working with an Elmore County bankruptcy law firm can help you explore all of your legal options. Debt often feels overwhelming and daunting to consumers, especially if they have never been through the legal process before. But working with an attorney who has been doing this for decades gives you the guidance and insights you need to address these complex issues.

One of the first things an attorney can help you do is determine if you should file for bankruptcy and what type you should consider. As noted above, this creates an automatic stay. Simply by filing for bankruptcy, you can pause other debt collection efforts, such as foreclosure actions by your mortgage lender. The automatic stay will eventually be lifted, but this buys you time to get your finances in order and deal with the debt to prevent these collection efforts.

An attorney can help you determine what paperwork to file, what documents or evidence will be necessary and what deadlines you need to meet – or court dates you need to attend – as your case proceeds. Our experienced guidance is vital at this time.

Call Now For A Consultation

If you want to learn more, just set up your initial consultation by dialing 334-521-1454 or using the online contact form. The Law Office of Jeffrey J. Courtney, LLC, looks forward to meeting with you, answering your questions and exploring all of your options.