As you may know, debt can take on more than one form. You have to deal with current debts you’re paying off and sometimes, that debt can be considered expired. Yes, even debt comes with a statute of limitations. A debtor may not be able to sue you or take any action against you for the debt, but that doesn’t mean they won’t try.
Expired debt can remain on your credit report long after it has expired and since debt collectors can still come after you and make attempts to collect it, there are several options you have in dealing with it. Let’s talk about expired debt and how to handle it.
1) Just Ignore the Debt
If the debt remains on your credit report, that can hurt you in the long run. But if you no longer have a concern that requires credit, then you can just ignore it. Decide you won’t need to borrow money in the future and everything will be great. The debt has expired, so you no longer have any legal requirement to pay it off. There’s nothing they can do legally to come at you to collect on it, so you’re in the clear that way. Just throw up your hands and walk away!
2) Just Get Rid of It
On the flip side of point number one, even though it’s expired, you might want to get that debt off your credit report. It will still haunt you later on if you need a loan. You may no longer be required to pay it back and you might be tempted to shrug your shoulders and walk away from it, but the only real way to be absolutely done and to get the debt collectors off your back is to pay it off.
3) Take Other Actions to Counter It
An old, lingering debt will remain on your credit report, sure, but you can take other actions to improve your credit score. If you still have other loans and credit cards, make regular, on-time payments. Show that you’ve learned from your earlier mistakes and improve your on-time payment record. This is really the best way to get through the situation if you’re ready to walk away from the previous debt. You can still improve your credit score in other ways.
4) File for Bankruptcy
This is not a decision you should take lightly. It’s really the nuclear option when you have no other choice but to wipe the slate clean and start over. You won’t be able to get any more credit for seven years and most likely no one will touch you with a ten-foot pole. Understand the consequences before declaring bankruptcy, but if the debt is just way too much to handle, it might be your only chance to deal with it once and for all. And once you’ve declared bankruptcy and the slate is wiped clean, the debt collectors can no longer come after you legally.
