February 28, 2024

Ohio Debt Collection Statute of Limitations

Debt collection is a common practice in Ohio, and it is important for both creditors and debtors to understand the statute of limitations that applies to debt collection. The statute of limitations is the time limit within which a legal action can be taken against a debtor for an unpaid debt. In Ohio, the statute of limitations for debt collection varies depending on the type of debt.

The Statute of Limitations for Written Contracts

For written contracts in Ohio, the statute of limitations is eight years from the date the debt became due. This means that if a debtor has not made a payment towards a written contract debt for eight years, the creditor cannot file a lawsuit against the debtor to collect the debt. However, it is important to note that if the debtor makes a partial payment towards the debt, the statute of limitations clock resets, and the creditor has another eight years to pursue the debt.

The Statute of Limitations for Oral Contracts

For debts that arise from oral contracts in Ohio, the statute of limitations is six years from the date the debt became due. An oral contract is a spoken agreement between the creditor and debtor that outlines the terms of the debt. If the debtor has not made a payment towards the oral contract debt for six years, the creditor cannot file a lawsuit against the debtor to collect the debt.

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The Statute of Limitations for Promissory Notes

A promissory note is a written contract that outlines a promise to repay a debt. In Ohio, the statute of limitations for promissory notes is six years from the date the debt became due. If the debtor has not made a payment towards the promissory note debt for six years, the creditor cannot file a lawsuit against the debtor to collect the debt.

The Statute of Limitations for Open Accounts

An open account is a type of debt where a debtor makes multiple purchases on credit and makes payments on a regular basis. In Ohio, the statute of limitations for open accounts is six years from the date of the debtor’s last payment. This means that if the debtor has not made a payment towards an open account debt for six years, the creditor cannot file a lawsuit against the debtor to collect the debt.

Exceptions to the Statute of Limitations

There are some exceptions to the statute of limitations for debt collection in Ohio. For example, if the debtor leaves Ohio and the creditor cannot locate them, the statute of limitations clock stops until the debtor returns to the state. Additionally, if the debtor acknowledges the debt in writing or makes a partial payment towards the debt, the statute of limitations clock resets, and the creditor has another six or eight years to pursue the debt.

Conclusion

Understanding the statute of limitations for debt collection in Ohio is crucial for both creditors and debtors. Creditors must be aware of the time limit within which they can file a lawsuit against a debtor, while debtors must be aware of their rights and obligations. It is important to note that the statute of limitations is not a defense against the debt itself, but rather against the legal action that can be taken to collect the debt. If a debtor has an unpaid debt, they should make every effort to pay it off or negotiate a payment plan with the creditor to avoid legal action.

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