by Jeff Sovern
Consumers have no legal obligation to pay time-barred debts and suing on such a debt or threatening to sue on one violates the FDCPA. But are consumers ever better off, aside from feeling better for meeting their obligations, by paying such debts? When a statute of limitations is less than seven years, as is often the case for consumer debts, creditors are able to report a debt as unpaid after the statute of limitations has past. My impression (which may be wrong) is that the older the debt, the less impact it has on the credit score, so conceivably a debt older than a statute of limitations does not affect a credit score, but I suspect they often do. If a consumer pays the debt, would the consumer's credit score improve? Or does paying such an old debt have no impact on credit scores or access to credit? If you know, please answer in the comments.