What Is the Statute of Limitations on Debt?

Total American household debt has reached nearly $17 trillion. Credit cards, home loans, student debt, and car loans are the top reasons people owe money in this country. Often, insurmountable debt can be cleared by filing for bankruptcy, but that may not shield an individual from claims seeking repayment of debts. However, there is a time limit by which claims must be made, which is known as the statute of limitations.

If you have concerns about how to handle debt and the pros and cons of filing for bankruptcy, a qualified attorney can guide you through the process. They can provide legal representation to clients who would like to get out of debt and individuals who require legal action to compel a borrower to repay their loans.

What is the Statute of Limitations on Debt?

What Is the Statute of Limitations on Debt?

The statute of limitations on debt is governed by Section 16.004 of the Texas Civil Practice and Remedies Code. Any person seeking to file a claim to compel someone to pay a debt must do so within four years of issuing the debt. The statute of limitations means that after four years have passed, the person or business that issued the loan can no longer file a lawsuit as a means of collecting the debt.

If the debt collector or creditor files a claim within the four-year window and wins the case, the debtor must repay the debt. A judgment can be enforced through a variety of means unless the debtor does not have any assets or money that the creditor can claim. A debtor may avoid debt collections in certain circumstances by filing for bankruptcy. An attorney can explain the various options for these legal filings and how the process will look as you move forward.

Benefits of Filing for Bankruptcy

Whether you are dealing with mounting credit card debt, medical debt, or another financial obligation, we can help you find the ideal remedy to shore up your finances. Filing for bankruptcy is often an effective means of erasing debt so you can live without the burden of credit card debt collection agencies contacting you on a daily basis.

Working with an attorney allows debtors to maintain their possessions and property. This means you do not have to stress out about losing everything you own. Bankruptcy allows debtors to legally write off unsecured debts like credit card balances.

With the help of an experienced attorney who will file for bankruptcy on your behalf, an automatic stay will go into effect. This prevents creditors from attempting to collect on debts or even contact you. If you are worried about repossessions and foreclosures, an automatic stay can protect those assets in most situations.

Do I Need an Attorney to File for Bankruptcy?

While it is technically possible to file for bankruptcy without legal counsel, doing so would be highly ill-advised. Improper filings and legal arguments could result in a debtor being unable to use the legal system to clear debts. Creditors and collections agencies understand the legal system, and anyone facing debt should see hiring an attorney as a worthwhile investment in their future.

Bankruptcy laws are complicated, and the procedures require an experienced lawyer who will fight for your interests through the process that may require a trustee to be appointed to your case. During meetings with creditors, your attorney can represent your interests to create a plan to restructure and settle debts.


Q: Do Judgments Go Away With Bankruptcy?

A: Certain obligations cannot be erased through bankruptcy. Child support, alimony, and federal student loans are all financial obligations that must be paid or unpaid. There are many types of debt and judgments that can be erased through a bankruptcy filing in Texas. If you are unable to pay your debts, there are civil remedies in place to clear many of those financial obligations.

Q: What Personal Property Can Be Seized in a Judgment in Texas?

A: Without protections from an experienced attorney, a judgment in Texas could result in assets being seized. A lien could be placed on a home, for example. A court order can lead to garnished wages or withdrawals from your bank account. Household goods and vehicles are subject to repossession and auction.

Even your property can be seized following a medical debt judgment in Texas. If you are facing mounting debt that you cannot repay, don’t wait until the lender takes legal action. Hire an attorney who will fight for your rights.

Q: How Many Times Can a Judgment Be Renewed in Texas?

A: With the help of an experienced attorney, you can renew a judgment until a debt is repaid in full in most cases. The limits on renewing a judgment depend on what type of judgment you were awarded.

A property lien, for example, can be renewed for an additional 20-year period by the timely filing for a renewal before the previous judgment expires. A missed deadline means that you will not be able to renew a judgment, so work with an experienced attorney who will handle those legal filings on your behalf.

Q: Can I Keep My Car if I File Chapter 7 in Texas?

A: Fortunately, exemptions for motor vehicles in Texas are particularly generous. A Chapter 7 bankruptcy can help debtors keep one car for each household member who has a driver’s license. In some cases, a car can be exempted even for individuals who do not have a license if that person depends on someone else to drive the car for them.

Schedule Your Consultation With Steele Law Firm, PLLC, Today

Whether you are seeking legal action to compel a debtor to repay their loans or need legal protections from creditors, Steele Law Firm, PLLC, is here to help. Mounting debt can be a source of extreme stress, but bankruptcy laws exist to help people obtain a fresh start in life.

Our attorneys understand the statute of limitations on debt and other important aspects of bankruptcy law. With the right legal representation, you can put your financial worries behind you. Contact our law firm today to schedule your consultation.

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