Bankruptcy and the Statute of Limitations on Debt in Florida

Debtors who are considering a bankruptcy filing in South Florida might find information about the statute of limitations for various debts, and they may be wondering if they actually owe debts that could now be time-barred. The term “time-barred” refers to a claim (such as the collection of a debt) that is no longer valid under the law because the clock on the statute of limitations has run out. What is the relationship among bankruptcy, debt statutes of limitations, and time-barred debt?

In short, if all of your debt is time-barred debt, a bankruptcy filing likely is not the most logical course of action for you. Our West Palm Beach bankruptcy lawyers can explain, and we can assess your financial circumstances today if you have questions about your personal liabilities for certain debts and the statutes of limitations associated with those debts.

What is the Statute of Limitations for Debts in Florida? 

The “clock” on the statute of limitations varies for different types of debt in Florida, but the function of the statute of limitations is the same. For any kind of agreement between a creditor and debtor, there is a time window, or clock, on the amount of time a creditor (or debt collector) has to enforce the agreement. The clock usually begins “ticking” on the date the agreement was entered into (such as the day a credit card application was approved and a charge was made, or the date services were rendered for medical debt and the debt became owed). Once the clock runs out, the debtor is no longer legally liable for the debt, which means a creditor or debt collector cannot take any action to collect — including lawsuits, wage garnishments, and more.

Under Florida law, most common debts have a five-year statute of limitations, such as credit card debt and medical debt. Some other types of debt have a shorter or a longer statute of limitations, while family support debt has no statute of limitations (which means the debtor is always liable for it). Most debts that are discharged in bankruptcy cases are debts with a five-year statute of limitations, but you should discuss all details with a lawyer before you draw any conclusions.

Time-Barred Debt That You Will Need to Discharge in Your Bankruptcy Case 

If you have time-barred debt and have recently been in contact with a creditor or debt collector about it, you should be aware that you could have “revived” the debt — meaning that you are once again liable for it despite the expiration of the statute of limitations — because of an agreement to pay. Under Florida law, if you make a “promise to pay barred debt,” and you sign anything indicating that you will make a payment on barred debt, the statute of limitations no longer bars the ability of the creditor or debt collector to come after you for that debt. You will have “revived” the debt.

In the event you agreed to repay some or all of a time-barred debt, or made a legal “promise to pay,” you will want to ensure that the debt is dischargeable when you file for bankruptcy. It will be important to have this debt discharged so that you are no longer liable.

Contact Our West Palm Beach Bankruptcy Lawyers Today 

If you need help with bankruptcy in general, or determining whether your debts are eligible for discharge, you should contact an experienced West Palm Beach bankruptcy attorney at Kelley, Fulton, Kaplan & Eller today for assistance with your bankruptcy case.

Sources:

law.cornell.edu/uscode/text/11

leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=0000-0099/0095/0095ContentsIndex.html

casetext.com/statute/florida-statutes/title-viii-limitations/chapter-95-limitations-of-actions-adverse-possession/section-9511-limitations-other-than-for-the-recovery-of-real-property