Can a collection agency still collect money for a business that is closed down?

UPDATED: Aug 28, 2011

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Can a collection agency still collect money for a business that is closed down?

The college I went to closed down.They hired a collection agency before they closed to collect some money I owed them. Do I still owe them money if they are no longer in business?

Asked on August 28, 2011 Ohio


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

If you owed the college money and the college is no longer in existence, there is a possibility that your former school assigned all of its accounts receivables to the collection agency that has been in contact with you.

In order for the collection agency to have any right to collect upon this alleged debt owed by you, it must have a written assignment of this debt from your former college. You should ask for any such document frm the person with the collection agency that you are dealing with.

Another issue is that if the debt is more than four (4) years old and no law suit has been filed against you for its collection, the applicable statute of limitations in your state may bar the collection agency from prusuing any assigned claim that it may have against you.

Good question.

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