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Statute of Limitations on North Carolina Credit Card Debt

someone holding out 4 credit cards fanned out

The advent of credit cards in the 1950s brought with them unmatched buying power for Americans. But they also brought more risks for consumers and for some, financial ruin. Today, more than 191 million Americans have credit cards, and the average card holder has 2.7 different cards.

Credit card usage took a dive last year, coinciding with the pandemic. Still, the average household credit card debt for 2020 was over $5,000. Lingering debts can mean compounding interest, a poor credit score, and the threat of a lawsuit by the creditor. For that reason, it’s important to know more about your debt. Specifically, how long does a debt have to exist before the statute of limitations expire and what does that mean for consumers?

How does a statute of limitations apply to credit debt?

A statute of limitations (SOL) in the financial realm is complicated and often misunderstood. In this case, the SOL refers to how long a creditor has to file suit against the debtor for the unpaid debt. This is an important distinction from having the debt cleared, because the debt remains. What is different, however, is that creditors can no longer take legal action to reclaim the debt (such as wage garnishment and liens).

Creditors can still pursue debt repayment within the terms of the Federal Debt Collection Act.

Another point of confusion surrounds a debtor’s credit score. The SOL of credit card debt does not apply to how long a charge can stay on your credit report. For more information on how long information stays in your history, please see this helpful guide from the Consumer Finance Protection Bureau.

North Carolina SOL

Credit debt statute of limitations varies drastically by state. In North Carolina, debts “expire” three years after the debtor makes the last payment. The phrasing of the law is extremely important, because consumers who make a payment on a debt even two and a half years after it was originally due will reset the clock.

Therefore, it’s important for consumers to look at the complexities of debt relief before making payments.

After a debt passes the three year mark, what rights does a consumer have? Remember: expired debts can no longer be grounds for a lawsuit against a debtor. If a creditor tries to do so, they are unquestionably breaking the law. Unfortunately, it’s a common occurrence with large corporations.

If you are sued for not paying a debt older than three years, contact an attorney immediately. An experienced consumer law professional should review your individual case and advise your defense.

Raleigh Civil Litigation and Debt Collection Attorneys

Maginnis Howard’s consumer protection attorneys help businesses and individuals navigate the complexities of debt collection law across North Carolina. You can learn more about our lawyers here, and when you’re ready contact us at (919) 526-0450, by email at, or through our contact page.