Debt collectors in North Carolina

Credit cards: G.S. 1-52(1) sets 3 years for any action 'upon a contract, obligation or liability arising out of a contract, express or implied', so written, oral, open-account and account-stated claims all get 3 years. The UNC School of Government judicial guide for NC district court judges (Sasser, 2018) treats credit-card claims brought as breach of contract, open account or account stated as all subject to 3 years under 1-52(1).

Payments and acknowledgments: (a) Before expiry: G.S. 1-26 requires a signed writing for an acknowledgment or promise, but 'does not alter the effect of any payment of principal or interest.' The UNC SOG guide (citing Whitley Elec. Service v. Sherrod, 293 N.C. 498 (1977)) says the open-account period runs from the last payment, and a partial payment acknowledging the debt starts the period anew. (b) After expiry: a signed written promise or acknowledgment can still revive the debt under general law, but collection agencies (debt buyers included) may not seek an acknowledgment of a time-barred debt without disclosing its nature and consequences and that the consumer has no legal obligation to give it (G.S. 58-70-115(1)). Debt buyers, and anyone acting for them, may not sue or 'otherwise attempt to collect' a debt they know or should know is time-barred (58-70-115(4)). No statute says that payment does not revive.

Judgments: G.S. 1-47(1): an action on a judgment must be brought within 10 years of its entry. That action yields a new judgment, which in effect renews it, but 'No such action may be brought more than once, or have the effect to continue the lien of the original judgment.' G.S. 1-234: the judgment lien on real property lasts 10 years from entry.

Other rules: Official ncleg.gov returned a Cloudflare 403 block (HTML, PDF and ftp mirrors; browser too). Statute text came from FindLaw (labelled current as of 2023-01-01) and was cross-checked against the UNC School of Government judicial guide. Sealed instruments get 10 years (1-47(2)). The 1-47(2) proviso lets a defendant counterclaim on the same transaction even where a shorter limit would otherwise apply. Non-negotiable notes fall under the 3-year 1-52(1) unless sealed. 25-3-118(b) (demand notes) gives 6 years from demand, or bars the note after 10 years with no payment. The debt-buyer rules in 58-70-115(4)-(6) and 58-70-145 to -155 bind 'collection agencies', which includes debt buyers. Under 58-70-155(d), a default or summary judgment entered for a non-compliant debt buyer is void and can be vacated under Rule 60(b). The time-barred suit ban covers debt buyers only. Original creditors collecting their own debts fall under G.S. 75-50 et seq., where I found no time-barred suit ban. I did not verify the 4-year UCC 25-2-725 period for sale-of-goods/retail installment contracts. Federal Reg F (12 CFR 1006.26(b)) separately bars FDCPA debt collectors from suing or threatening suit on time-barred debt.

• open account: N.C. Gen. Stat. § 1-52(1)
• written contract: N.C. Gen. Stat. § 1-52(1) (3 yrs); § 1-47(2) (10 yrs for sealed instruments)
• oral contract: N.C. Gen. Stat. § 1-52(1)
• promissory note: N.C. Gen. Stat. § 25-3-118(a) (6 yrs, negotiable note payable at a definite time)
• judgment: N.C. Gen. Stat. § 1-47(1); § 1-234 (lien 10 yrs)
• payment restarts: N.C. Gen. Stat. § 1-26; Whitley Elec. Service, Inc. v. Sherrod, 293 N.C. 498 (1977) (as cited in the UNC SOG judicial guide)
• other: N.C. Gen. Stat. § 58-70-115(1), (4)-(6) (time-barred acknowledgment disclosure; debt-buyer time-barred suit/collection ban; 30-day pre-suit notice); §§ 58-70-145, -150, -155 (debt-buyer pleading and default-judgment requirements; non-compliant judgments void)

Sources: codes.findlaw.com · codes.findlaw.com · sog.unc.edu