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Phillips Esq.
Phillips Esq., Attorney-at-Law
Category: Consumer Protection Law
Satisfied Customers: 12846
Experience:  B.A.; M.B.A.; J.D.
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Credit Card

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I have a situation where I had lost my job last month and have not been able to pay my Capital One ($1,500) and Discover($1,600) and Credit First ($1,200) credit card. I called the day I lost my job and tried to work something out with them... up until this point I have had an awesome payment history with them, they were not able to offer me any hardship plan that I could adhere to. Basically all three of them told me to wait till I start getting collection calls and if I can work out something with them then, or wait for it to just be charged off. Everyone is telling me horror stories of Capital One and discover card taking people to court ect. With such a small amount that I owe I cant imagine them doing so but...how long are they allowed to keeping charging my account late fees and penalties? I know I am in for a time of calls and threats but is there a standard or law to how many months they can charge me the late fees? I am going to end up owe 10 grand if they dont stop at some point.

Submitted: 9 months ago.
Category: Consumer Protection Law
Expert:  Phillips Esq. replied 9 months ago.
Hello: This is PhillipsEsq. I am a licensed Attorney and I will be assisting you today.

I have a situation where I had lost my job last month and have not been able to pay my Capital One ($1,500) and Discover($1,600) and Credit First ($1,200) credit card. I called the day I lost my job and tried to work something out with them... up until this point I have had an awesome payment history with them, they were not able to offer me any hardship plan that I could adhere to. Basically all three of them told me to wait till I start getting collection calls and if I can work out something with them then, or wait for it to just be charged off. Everyone is telling me horror stories of Capital One and discover card taking people to court ect. With such a small amount that I owe I cant imagine them doing so but...how long are they allowed to keeping charging my account late fees and penalties?

Response 1: They can keep charging your account for late fees and penalties until the account is paid off, regrettably. Yes, these two companies do send the accounts to law firms that would sue for the small amounts. However, once the law firms are retained, they would try to settle. If you are not working and do not have any assets for them to come after, you should not be afraid of any lawsuit. Once the law firms do their research and confirm that you are not working and that you do not have any assets for them to go after, they would most likely settle, about 60% off the balance is reasonable.

I know I am in for a time of calls and threats but is there a standard or law to how many months they can charge me the late fees? I am going to end up owe 10 grand if they dont stop at some point.

Response 2: There is no time limitation for the charges. So, your accounts would continue to accrue interest and late fees. However, there is time limitation for them to file lawsuit. If the limitation period expires, they can no longer file lawsuits for the debts and without a threat of lawsuit, THERE IS REALLY NOTHING THAT THEY CAN DO TO YOU. The Statute of Limitations for credit card debt in Delaware is three years.

The Statute of Limitations on a debt deals with the time a creditor/collector has to file a lawsuit to collect on its debt or forever barred from bringing up the lawsuit. The creditor may still use other means to try to collect the debt such as telephone calls and letters. However, without the threat of lawsuit, there is really nothing the creditor/collector can do. So, a debtor does not have to pay debts that are passed the Statute of Limitations. Finally, if a creditor files a lawsuit, the fact that the Statute of Limitations has run on the debt is an Affirmative Defense and the debtor must request that the Court dismiss the case because the Statute of Limitations has run on the debt.

The Statute of Limitations on a debt starts to run from the time the debtor stopped paying on the debt. Kindly note that paying anything on the debt will restart the Statute of Limitations period. So, the debtor must not agree to pay anything on a debt that has passed its Statute of Limitations.

Phillips Esq., Attorney-at-Law
Satisfied Customers: 12846
Experience: B.A.; M.B.A.; J.D.
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