Five Things You Need to Know about the Michigan Statute of Limitations on Debt
Worried a few old, overdue contracts or open balances on your books have been sitting too long for you to do anything about them? Unsure what your options are to pursue payment on old accounts?
Our experts on debt collection in Michigan understand that handling long overdue accounts can be a time consuming and stressful job.
These accounts should be turned over to a debt collection professional as soon as possible to avoid having your account eliminated by the statue of limitations. Here are the five things you should know about Michigan SOL’s on debt.
- As a creditor, the statute of limitations sets the time period for you to take legal action against a debtor.
- The statute of limitation is six years for most written or oral contracts. The countdown does not begin until the customer misses the first payment or defaults on the terms of the contract. The statue could be renewed when a new payment is made.
- If your agreement or contract with your customer was for the sale of goods, you would normally only have a four (4) years to start a legal action to recover on the outstanding balance.
- The statute may be revived in a few different ways. A partial payment can reset the clock, even if the SOL has long passed. The legal term for an action that restarts the statue of limitations is a NOVATION. Under most state law, the partial payment could toll the statue all over again as of the date of payment.
- You may still have a legal case on a very old debt. Our legal expertise on debt collection in Michigan can assist you in determining the best course of action for your company.
A little bit of information can go a long way; knowing more about your rights to pursue payment you’re owed can help turn hesitation into action. These facts should help you make some decisions on old, open accounts you’ve had on the back-burner for a while.
If you find that taking action on several outstanding accounts is more than you can handle on your own, turn to the premier debt collection service in Michigan at MMRHM, P.C. With more than 57 years’ experience assisting businesses like yours, we have the tools to get the job done effectively and ethically.