If I was not contacted for 4 years that a bank account was overdrawn, can a collection company now require me to pay the debt?

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If I was not contacted for 4 years that a bank account was overdrawn, can a collection company now require me to pay the debt?

I had a bank account and after getting fed up with ridiculous fees, I paid a fine and had the teller close the account. I was told the account was closed and haven’t heard a word from the bank since. Today a collection agency called me and informed me I owe about $1,100. I told them I had not been notified once in 4 years of this debt. They asked me to pay it and I told them that was something that had to be discussed with my husband. Then I called the bank and they had no helpful information as to why I owed it. Do I still owe?

Asked on May 15, 2012 under Bankruptcy Law, Michigan

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

Procedurally, the statute of limitations, or time to sue, in your state on a written contract or agreement (like the agreement(s) which governed that bank account) is 6 years, so the bank, or a collections agency on its behalf  (or which had purchased the debt) could take legal action 4 years later to enforce the debt.

Sustantively, they can only sue you for amounts you actually owed as per the agreement under which you banked. If you had not owed $1,100 prior to closing the account and then had closed it, it's difficult to see how they are coming after you for that amount now, unless there is a factual dispute over whether the account was validly closed. (For example, under the agreement with the bank, did you have to close an account in writing?)


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