Re-Aging Debt

What Is Re-Aging Debt?

Re-aging debt happens when there is a restart at work on an old debt's statute of limitations. Re-aging debt can occur on the off chance that a borrower converses with a creditor about an old debt or makes a payment on an old debt. Re-aging debt is great for debt collectors since it empowers them to collect a debt. Nonetheless, re-aging debt is typically awful for consumers since it puts them back on the hook for paying an old debt that could have had an old statute of limitations.

Figuring out Re-Aging Debt

First off, on the off chance that a creditor contacts a borrower about repaying an old debt, it could be best for the borrower not to say or do anything until they see if they still legally owe the debt. If they unintentionally re-age the debt, they could become responsible for paying something past the statute of limitations or that they previously had released in bankruptcy or settled with a creditor. The borrower could need to demonstrate they are not responsible for the debt while likewise attempting to ensure the creditor doesn't report the unpaid debt as delinquent.

Different Causes That Trigger Re-Aging Debt

Re-aging debt could likewise happen on the grounds that old, unpaid debt gets bought and sold by debt collectors in a secondary market. These collectors frequently have no clue about whether the debt they are purchasing is genuine, was the result of identity theft, was paid off, was pardoned by the creditor, or is past the statute of limitations.

The reason the age of a debt matters is a result of the statute of limitations. This period normally endures from three to 10 years, contingent upon the state of jurisdiction that applies to the debt and the type of debt. When this period is up, a creditor can't sue a consumer for an unpaid debt. On the off chance that the debt is recognized, notwithstanding, the borrower might need to pay the debt in full or reach a settlement. Therefore it's recommended that if all else fails, a borrower doesn't pre-emptively act to recognize a debt before affirming assuming it is a legitimate debt to collect on.

Dishonest debt collectors could likewise illegally re-age a debt by reporting it to credit bureaus after they purchase it in the secondary market, even however they have no clue about how old it is or whether money is owed. In the event that this occurs, a borrower can report the debt to the credit bureau as mistaken, which ought to result in the debt collector demonstrating the legitimacy of the debt.

There is one great type of re-aging; it happens when a borrower sorts out a debt repayment plan with a creditor, and they agree to stop reporting the account as delinquent. All things considered, they re-age the account and report it as current, which can further develop the borrower's credit score.

Features

• The age of a debt matters, and contingent upon the statute of limitations can be anywhere from three to 10 years regularly. After this period, a creditor can't sue for an unpaid debt.
• Re-aging debt happens when there is a restart at work on an old debt's statute of limitations.
• Frequently, unpaid debt can resurface on the off chance that a creditor contacts a borrower about repaying an old debt, or on the other hand assuming unpaid debt gets bought and sold by debt collectors in a secondary market.