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North Carolina Statute of Limitations on Debt

Hannah Locklear | December 19, 2023

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Fact-checked by George Simons, JD/MBA

George Simons
Co-Founder of SoloSuit
George Simons, JD/MBA

George Simons is the co-founder and CEO of SoloSuit. He has helped Americans protect over $1 billion from predatory debt lawsuits. George graduated from BYU Law school in 2020 with a JD/MBA. In his spare time, George likes to cook, because he likes to eat.

Summary: The statute of limitations on debt in North Carolina is generally three years. If you are being sued for an old debt in NC, you should respond immediately and use the expired statute of limitations as a defense. SoloSuit can help you draft and file your Answer in 15 minutes.

If you are in debt, it can be a terrible situation. You might have credit card bills or a loan catching up to you that you’re not able to pay off. Luckily for you, all debt has a statute of limitations, other than student loans.

The statute of limitations sets the time limit for how long you can be sued for a debt, and this time limit varies from state to state Once the statute of limitations has passed, the debt is considered “time-barred.”

If you’re being contacted about a debt in North Carolina, you should investigate the debt before agreeing to make any payment and risk restarting the clock on the statute of limitations.

In this article, we’ll discuss everything you should know about the statute of limitations on debt in North Carolina. Let’s get right to it.

North Carolina statute of limitations on debt collections

The North Carolina General Statutes, states:

Ҥ 1-52. Three years.
Within three years an action -
(1) Upon a contract, obligation or liability arising out of a contract, express or implied, except those mentioned in the preceding sections or in G.S. 1-53(1).”

In other words, the statute of limitations on debt in North Carolina is three years. This means that a creditor or debt collector only has three years to sue someone for a date, starting from the date of the first missed payment made on the account. So, the NC statute of limitations on credit card debt is just three years. Likewise, the statute of limitations on medical debt in NC is three years too.

The table below further outlines the North Carolina statute of limitations on different types of debt:

North Carolina Statute of Limitations on Debt
Debt Type Deadline in Years
Credit card 3
Oral contract 3
Written contract 3
Open contract 3
Medical 3
Student loan 3
Auto loan 3
Personal loan 3
Mortgage 10
Judgment 10
Source: N.C. Gen. Stat. § 1-47 and § 1-52

It is essential to know that the statute of limitations starts from the date of the last activity on your account. As we said, this might be the date of your first missed payment on the credit card, but it can also mean the last time you acknowledged you owe the debt or made a payment on the debt.

If you are being served with a debt lawsuit, there are a few things that you should know regarding debt and the statute of limitations. This is essential to avoid being taken advantage of by a debt collector.

Use the statute of limitations as your affirmative defense with SoloSuit.

Making a payment resets the statute of limitations on debt

If you are living in North Carolina and you are being sued for credit card debt, you will need to check the last time you made a payment. If the last time you paid a delinquent credit card bill was two years and 11 months ago, you may suddenly get calls from the creditor or a debt collector.

It is essential to notice this, because the creditor may try to convince you to make a small payment, as a way to manipulate you into starting the statute of limitations over again. This can be as low as five or ten dollars.They may convince you that doing this will help you to work on the debt. By making this incredibly low payment you will reset the clock on the statute of limitations and you may then be served with a debt lawsuit.

If you would have waited one more month, you would have been able to refuse the debt lawsuit, because it would be illegal to sue you for the debt. This is why it is important to know the last date of the activity to protect your interests.

Creditors can still try to collect on a time-barred debt

Even after the statute of limitation expires, the original creditor can continue to go after you for payment. This is because although you cannot be brought to court, you still owe the debt. The debt is not going to magically disappear. This also means that they can call or send letters, but can no longer threaten to sue you.

Time-barred debt also means that they cannot make statements that may indicate they have legal recourse for the debt. Even though they can continue to call you and ask for you to pay it, the only thing that is going to hurt you is when they report it to the credit bureaus. It is almost guaranteed they will continue to do this for seven years. After seven years though, it falls off your credit as well.

Don't let creditors harass you. File a response with SoloSuit.

Debt buyers can't collect on an expired debt

Although an original creditor can collect a debt that you owe after the statute of limitations has expired, a debt buyer cannot. The original creditor might be a credit card company or someone who has issued you a loan. Once the debt is in the hands of a debt buyer it means that it was sold to them by the original creditor.

In North Carolina, debt buyers may not collect on debts where the statute of limitations has expired. This means that firms who specialize in collecting debts and who purchase debt from creditors may not pursue you after three years.

It is important to note that debt buyers and debt collectors are two different roles. Debt collectors are typically hired on behalf of the original creditor. In this case, if they are acting on behalf of the original creditor, they are not barred from collecting. In this case, they must have purchased the debt directly from the original creditor.

Debt buyers on the other hand are in a different situation. Debt buyers have typically purchased your debt at a highly discounted rate, and it has typically passed multiple hands. Because of this, they are barred from collecting once the statute of limitations has expired.

Lawsuits can still be filed for old debts

Even after the statute of limitations has been lifted, it does not mean that the courts are aware of this. This means that although the statute of limitations may have expired on your debt in North Carolina, a lawsuit can still be filed against you.

Even if you know the statute has expired, you still need to respond to the lawsuit within your state’s deadline. If you do not respond, then you may be given a default judgment. Although this does not make sense based on the fact that you legally cannot be brought to court, no one is going to investigate this except for you.

Because of this, it is so important to be an educated consumer regarding how old your debt is, and if the statute has expired. This will allow you to defend yourself in a lawsuit versus a debt buyer, debt collector, or original creditor should they bring one against you.

Now, let’s take a look at an example.

Example: Josh is being sued by a debt collector for an old credit card debt in North Carolina. The debt is only $400, and after doing some research, Josh learns that he hasn’t made any payments on the account for the past four years. In North Carolina, the statute of limitations on credit debt is only three years. Josh uses SoloSuit to respond to the lawsuit. In his Answer document, Josh uses the expired statute of limitations as one of his affirmative defenses. Upon review of the case, the judge orders to dismiss the case.


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Use the statute of limitations as an affirmative defense in your debt lawsuit

If you’re being sued for an old debt, and you know that the debt is time-barred, you should respond to the lawsuit immediately with a written Answer.

In your Answer document, you should:

  1. Respond to each claim listed against you in the Complaint document.
  2. Assert your affirmative defenses.
  3. File with the court and show proof that you sent a copy to the opposing party.

In this section, we’ll focus on asserting your affirmative defenses. An affirmative defense is any legal reason that the person or company suing you should not win the case.

The North Carolina Rules of Civil Procedure Rule 8(c) states:

“(c) Affirmative defenses. - In pleading to a preceding pleading, a party shall set forth affirmatively accord and satisfaction, arbitration and award, assumption of risk, contributory negligence, discharge in bankruptcy, duress, estoppel, failure of consideration, fraud, illegality, injury by fellow servant, laches, license, payment, release, res judicata, statute of frauds, statute of limitations, truth in actions for defamation, usury, waiver, and any other matter constituting an avoidance or affirmative defense. Such pleading shall contain a short and plain statement of any matter constituting an avoidance or affirmative defense sufficiently particular to give the court and the parties notice of the transactions, occurrences, or series of transactions or occurrences, intended to be proved. When a party has mistakenly designated a defense as a counterclaim or a counterclaim as a defense, the court, on terms, if justice so requires, shall treat the pleading as if there had been a proper designation.”

This means that you must assert all affirmative defenses in your initial Answer, including the statute of limitations. If you do not include this information in your Answer, you probably won’t be able to bring it up later in the case.

Make the right defense the right way with SoloSuit.

To learn more about the three steps listed above, check out this video:

North carolina debt collection laws can protect you

Lucky for you, North Carolina debt collection laws protect you from abusive debt collection practices and can help you defend yourself against crazy creditors and collectors.

North Carolina General Statutes Chapter 75, Article 2 outlines laws that all debt collectors must follow if attempting to collect a debt in North Carolina.

Under Article 2, §75-51 states:

“No debt collector shall collect or attempt to collect any debt alleged to be due and owing from a consumer by means of any unfair threat, coercion, or attempt to coerce.”

This section continues to list examples of threats and coercions that are considered unlawful act by debt collectors, including:

  • Using or threatening to use violence with the intent of causing harm to the person, reputation or property of any person.
  • Making or threatening to make false accusations to another person, including to a credit reporting agency.
  • Claiming that someone can be arrested for not paying off a debt.
  • Threatening to take legal action that they cannot take (such as suing for a debt that is past the statute of limitations).

Similarly, §75-52 states:

“No debt collector shall use any conduct, the natural consequence of which is to oppress, harass, or abuse any person in connection with the attempt to collect any debt.”

The examples listed under this section include:

  • Debt collectors cannot use profane or obscene language, or language that would ordinarily abuse the typical hearer or reader.
  • Debt collectors must disclose who they are, and the company they represent, whenever they contact you.
  • Debt collectors cannot call you so frequently that it becomes harassment.
  • Debt collectors cannot call you at odd hours of the day, generally meaning before 8 a.m. or after 9 p.m.
  • Debt collectors cannot call you at work if they know your employer prohibits such communications.

Finally, sections §75-53, §75-54, and §75-55 state:

“No debt collector shall unreasonably publicize information regarding a consumer's debt.

No debt collector shall collect or attempt to collect a debt or obtain information concerning a consumer by any fraudulent, deceptive or misleading representation.”

No debt collector shall collect or attempt to collect any debt by use of any unconscionable means.”

Each of these sections also list examples.

If you have experienced any of these examples listed above when dealing with debt collectors in North Carolina, you may consider filing a counterclaim against them. Under the FDCPA, you could be eligible for up to $1,000 of compensation per violation.

You can also list these violations as affirmative defenses in your Answer document. SoloSuit makes it easy to know which defense to include and how to correctly state it in legal terms.

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