Question

Jon,

I think I know the answer to this question, but want a second opinion. I had a loan with Black Horse back in 2004, and after some personal problems stopped making payments in 2006. I have not heard from Black Horse since 2009, and that was a letter to my old address. The other day I received an email from a collection agency stating I now owe them the balance of that loan, plus interest and charges. My thoughts are the debt is no longer collectable due to the time that has passed since I last heard from Black Horse. Am I correct in this thinking?

H

Answer

H,

From what you have stated, if you have not had any contact from a creditor for a period of six (6) years, a debt can be said to be Statue Barred, or no longer owed.

It’s odd but I am hearing more and more about old Black Horse loans being sold to collection agencies. I am guessing a lot of those old loans were bought by the collection agencies pennies on the pound, and they are now trying to collect them.

If a loan is Statute Barred, there can be the issue you may be facing now, which is acknowledging the old debt, which would mean it can be collected again.

If you were to set-up a payment arrangement, or agree to the debt, the collection agency can then begin collecting it again. The agency knows this, and will try to get you to do this. The choice is yours as to what to do, but if the debt is Statute Barred, the collection agency can make all the threats they want, but they know they have no power to collect the account.

Regards,

Jon

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