When do collection agencies give up?

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Collection agencies might ease off after your provincial statute of limitations expires, which is between 2 and 6 years depending on your location. But stay alert, as they might still reach out about unpaid debts, especially large ones. Government and secured debts, like taxes and mortgages, follow different rules and may pursue longer. Reach out via phone, text, or live chat if you have any questions. Not all trustees can be trusted.

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Collection Agencies Give Up Question

When do collection agencies give up? DEBT INSIDERS I’ve been dealing with a collection agency for months. I want to know how long they will keep pursuing the debt before they stop.

From: Anonymous Question
Location: St Catharines, Ontario (ON)
Category: debt settlement

Collection Agencies Give Up Answer

Collection agencies usually back off after the provincial statute of limitations runs out, which ranges from 2 to 6 years depending on where you live. However, don’t breathe too easy just yet! They might still pop up in your life with a friendly reminder about that lingering debt. Their persistence could hinge on the size of what you owe, the financial waters you’re swimming in, and whether chasing you down is worth their time. But remember, when it comes to government debts, like those pesky CRA or student loans, collectors have the luxury of a longer chasing period. On the other hand, if you’re dealing with secured debts like mortgages, those play by entirely different rules!

From: Insider Adam

Office of the Superintendent of Bankruptcy (OSB) Answer

Collection agencies in Canada may stop pursuing a debt after a period known as the “limitation period,” which typically applies to unsecured debts. Under the applicable laws, the limitation period is generally 2 to 6 years, depending on the province. After this period expires, creditors, including collection agencies, are legally barred from making claims in court to collect the debt.

For instance, the Limitation Act in various provinces defines how long creditors can pursue debts, after which the debtor may raise the expiration of the limitation period as a defense. Therefore, if a collection agency has been pursuing a debt for longer than the limitation period specific to your province, they may legally have to cease their efforts. To understand more about unsecured debts and how they are treated, you can read about unsecured debt.

Refer to the Act, specifically the “Limitation of Actions” section pertaining to the relevant provincial legislation for exact timeframes.

From: OSB Helper

Related Questions to When Do Collection Agencies Give Up

Here are the top 5 most frequently asked questions related to when collection agencies give up, based on common concerns and trends in the context of Canadian debt and insolvency:

1. How long can a collection agency collect on a debt?

A collection agency can try to collect on a debt forever, but they can only pursue legal action within the statute of limitations, which varies by province (typically 2 to 6 years)[1][3].

2. What happens when the statute of limitations on a debt expires?

When the statute of limitations expires, the creditor or collection agency cannot take legal action to collect the debt, although they may still attempt to contact you for payment[1][3].

3. Can a collection agency still contact me after the statute of limitations has expired?

Yes, a collection agency can still contact you after the statute of limitations has expired, but they cannot threaten or initiate legal action[1][3].

4. How can I stop a collection agency from contacting me?

You can stop a collection agency from contacting you by paying off the debt, negotiating a payment plan, or sending them a notice by verifiable means to cease contact[5].

5. What are the rules collection agencies must follow when contacting me?

Collection agencies are restricted from contacting you more than three times in a 7-day period without consent, cannot call at certain times or on statutory holidays, and cannot use threatening or misleading language[5].

If you have a question about debt see our debt questions or ask your own debt related question.

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