In the UK, if a creditor has not contacted you, or attempted to collect a debt owed to them for a period of six (6) years, the account/debt is said to be Statute Barred, which means it is no longer collectable through the courts.
There are the key words, no longer collectable through the courts.
An account that is Statute Barred may be uncollectible via the courts or through the usual collection means, but it does not mean you no longer owe the debt. It just cannot be collected.
The debt may be written off, even though technically you still owe the money.
So what happens if you are contacted by a collection agency after the 6 year period and they are demanding payments?
Acknowledging an Old Debt
The grey area with a debt being Statute Barred is not having contact with a creditor for the period of 6 years. A creditor may have tried to contact you, but they may have had old details, no good address, or phone number to contact you. However, in most instances, after 6 years the debt is written off, and you are not liable to pay it; you are still in some ways responsible for the debt, but the creditor has no legal means to collect the debt.
That is unless you acknowledge the account, or re-engage with the account/debt.
So how would you do this?
If you are contacted by a collection agency who may have purchased the account, and they begin demanding payments. By setting-up a repayment plan you have acknowledged the debt, and the time line begins, again. They can now legally collect the account.
The issue here is more of a moral or conscience one, do you want to pay the debt, or can you walk away; and walk away knowing you cannot be chased legally for the debt?
There are debt collectors who having bought a Statute Barred account, knowing it cannot be legally collected, try to emotionally bully the debtor into paying. This can be by asking them to do the “right thing”, “you know you owe this”, etc.
Again, the facts are the debt can no longer legally be collected, however, if you acknowledge the debt, by making payments or signing a new agreement, then the debt goes from being dormant, to being alive.