New Case! Statute of Limitations on Arizona Credit Card Debt

TL;DR

Arizona Supreme Court clarifies when the statute of limitations starts on credit card cases in a new decision that overturns a previous ruling and gives consumers more control.

Transcript

• Hey everybody, John Skiba here from the Arizona Consumer Law Group. In today's video I wanted to talk about a brand new Arizona Supreme Court decision that came out today, July 27th of 2018 that clarifies when the statute of limitations starts on credit card cases. Now because of the just a huge volume of credit card cases, one would think that t... Read More

Key Insights

• 💳 The previous interpretation of the statute of limitations on credit card cases in Arizona gave the creditor complete control over when it started.
• 🎟️ The new ruling clarifies that the clock starts ticking from the first missed payment, giving consumers more control.
• 🍝 Partial repayments do not reset the limitations period, and all past-due payments must be brought current to restart the clock.
• ⏮️ The decision overturns a previous Court of Appeals ruling that favored the creditors, providing a more favorable outcome for consumers.
• 🤨 This ruling brings much-needed clarity to the issue of statute of limitations and addresses concerns raised by many people.
• 🆘 It is essential for individuals with serious debt problems in Arizona to seek help from organizations like the Arizona Consumer Law Group.
• ❓ This decision has significant implications for debt collection litigation, especially for accounts sold to junk debt buyers.

Questions & Answers

Q: What was the previous interpretation of the statute of limitations on credit card cases in Arizona?

Previously, the credit card company had the power to determine when the statute of limitations starts, potentially extending it indefinitely by delaying the acceleration of the amount owed.

Q: What did the Arizona Supreme Court clarify in the Mertola/Santos case?

The court clarified that the statute of limitations starts ticking from the very first missed payment, not when the debt is charged off. This gives consumers a clearer understanding of when the six-year time period begins.

Q: Can partial repayments reset the limitations period?

No, partial repayments do not reset the limitations period. To restart the six-year clock, all past-due payments must be brought current.

Q: How does this ruling impact debt collection litigation?

This decision is a game changer in debt collection litigation because it provides more clarity on when the statute of limitations starts and prevents debt collectors from extending it through delaying acceleration.

Summary & Key Takeaways

• The Arizona Supreme Court decided a new case, Mertola LLC versus Santos, clarifying the start of the statute of limitations on credit card cases and overturning a previous decision unfavorable to consumers.

• Previously, the credit card company had control over when the statute of limitations started, potentially allowing it to be extended indefinitely.

• The court clarified that the clock now starts ticking from the very first missed payment, rather than when the debt is charged off, and partial repayments do not reset the limitations period.