Do you feel as if you're drowning in debt?  Are the constant letters and calls from collection agencies making you crazy because you simply don't have the money to pay everyone?  Do you feel as if the light at the end of the tunnel is really an oncoming train? If you simply don't have the money to pay bills because it all has to go to essential living expenses, you need to know about the Statute of Limitations.
What is the Statute of Limitations? Basically, the Statute of Limitations is a law that sets a limit on when someone can bring a civil suit.
If that person does not sue within the time set by law, they cannot come after you.
For any reason.
When it comes to a debt that is too small for a creditor to sue over (usually under $20,000), that means that once the Statute of Limitations has passed, they cannot call you, write to you, or do anything whatsoever to collect that debt.
The Statute of Limitations has effectively wiped out the debt at that point.
Keep in mind that some collection agencies will continue to come after you even after the Statute of Limitations in your state has passed.
All you have to do is write them a letter telling them that the Statute of Limitations has passed and to stop contacting you.
How does the Statute of Limitations work? The date they received your last payment is the trigger for when the Statute of Limitations starts to run.
Every time you make a payment, the Statute of Limitations resets and starts over.
In some states, every time you contact a collection agency about this debt, that resets the Statute of Limitations.
This also affects how long the delinquency remains on your credit rating Let's say you lost your job, or had some other really bad luck and you just couldn't pay on a bill for a couple of years.
The Statute of Limitations started running the date of that last payment.
So now it's three years later.
And you finally have a little money and you'd really like to start chipping away at this bill.
DON'T!!! At this point, the ding on your credit report only has four years to go before it falls off.
The minute you contact the creditor, everything resets to zero.
 And now the ding will stay on your credit report for another seven years.
It also resets the Statute of Limitations in your state to zero At this point you have no leverage.
 The creditor has no incentive to clear the ding on your credit report because they now have another seven years to hold the debt over your head.
 And, depending on what state you live in, they now have additional three or more years to come after you for this debt.
What's the best thing to do? First, the worst thing you can do is to try to do the right thing.
 It will only cause you more grief and aggravation.
At this point, the best thing for you to do is to let the seven years pass and let the debt fall off of your credit report.
Old debts have a lot less ding power than new ones.
If you haven't missed a payment in the past several years, that will overshadow the old debts - especially if there was a good reason why you hadn't been able to pay those old bills.
You also want to check the Statute of Limitations for your state.
Most states are about four years, but some are more and a few are less.
Wait until the seven years on your credit report is past and the debt has fallen off your credit report.
You also want to make sure you are at least six months past the Statute of Limitations date in your state before you contact the creditor.
The reason for this is because if something happens and you suddenly can't keep to the repayment plan, you don't want a brand new ding with a new Statute of Limitations hanging over you.
Repaying the debt If you are in the position to start repaying the debt, put the money in a separate bank account and let it build up as you wait for the Statute of Limitations for your state to expire.
The Statute of Limitation is past - now what? Now you have the leverage.
If you are in a position to repay the debt, or part of it, contact the creditor and make them an offer.
 Tell them you will be happy to pay $XXXX on your bill if they will report your account paid as agreed on your credit report and wipe out any negatives.
Send this letter Certified, Return Receipt Requested.
 Never call or do anything on the phone.
 You want everything to be in writing.
The creditor knows that if they want to see any money, they will have to make a deal with you.
If you're not in a position to repay the debt, then you can at least start putting your life back together without it hanging over your head.
And it's a lot better than bankruptcy.
If you'd like to find out how to get debt collectors off your back until your life is back on track, check out my book, How to Disappear NOW.