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statue of limitations, old debt

in august 2002 i stopped making payments on all my credit cards due to financial difficulties. In march 2010, i checked my credit report and although the credit cards are mentioned in my report, the outstanding balances are zero for all accounts and the ratings are R1.

if i open a chequing account with a bank that i used to owe money to and deposit money, can they take my money to pay off the old debt??? whats the gaurantee that they will not take my money???


Posted from: British Columbia

One Response to “statue of limitations, old debt”

Barton Goth – Goth & Company Inc. -Trustee in Bankruptcy said...

Just because you stopped making payments doesn’t mean the Statute of Limitations will automatically kick in, if this was the case no one would make any payments on their debts and the debts would simply disappear. What is more important is what actions your creditors take. There are some very simple things creditors can do to preserve their collection rights. As most creditors are quite savvy, we find they typically do all that is necessary to preserve these rights.

The difficult thing is that it makes no difference what is listed on your credit bureau as this doesn’t reflect what actions a creditor has or has not taken, so just because they have listed the zero balance and the R1 rating doesn’t mean that you are not still responsible for the monies.

So if you open a bank account that you used to owe money to, there is a good likelihood they can seize the money within. The only guarantee you will have is if you do something to deal with the old debt (i.e. pay it in full, file a consumer proposal, file a bankruptcy etc.).