The Arizona state Senate recently passed a law clarifying the statute of limitations for collecting defaulted credit card debt from as being six years, according to a report from the Yuma Sun. Supporters of the bill say the old law was not clear enough in the window it spelled out, as some officials interpreted it to mean just three years.
However, opponents believe the bill will do little to help either state residents or lenders, the report said. Often, banks will sell defaulted accounts to collections agencies for pennies on the dollar within just a few months, meaning that out-of-state companies will likely be pursuing the debt for the extended period.
[Resource: Top Ten Debt Collection Rights for Consumers]
In addition, by extending the collection period, it will also double the length of time an account can accrue interest, leading to higher bills for consumers to pay, the report said.
Debt collection agencies’ harassing tactics have often been cited as one of the biggest consumer complaints nationwide, and topped the Federal Trade Commission’s list in 2010.