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bassmana · Mar 26, 2008, 05:49 PM

Over 5 years ago my wife was talked into co-signing a loan for a wayward son to buy a motorcycle. He wrecked the bike and never finished paying for it. The finance company repo'ed the bike and now a collection agency is calling my wife to collect on the debt. No payments have been made on the loan for over five years. Is there a statute of limitations in Texas that would protect us from the collection agency getting a judgement and levying our bank account? Also is there a way to work out a deal with the original lender to satisfy the debt still since a collection agency is involved? I am her husband and didn't know about the co-signing until everything went in the crapper. I've heard horror stories about collection agencies getting judgements and levying bank accounts without the account holder knowing about it until it had already happened. Would we have to be served with a court summons if they took it to court for a judgement?
What actions should we take?

Lots of questions... I know, sorry.

Thanks

progunr · Mar 27, 2008, 07:55 AM

I believe in Texas, the limitation on a written contract is 4 years. I'm however, unsure if this applies to the origination of the debt, or perhaps the time it was assigned for recovery.

Before any levy of your bank account can occur, you will have to be notified of the suit or intention to sue. Either way, you will have the chance to answer or defend your position.

Good Luck to you!

ScottGem · Mar 27, 2008, 08:56 AM

It would appear the SOL has expired so they cannot sue. Doesn't mean they can't dun you though. If they were to sue you would have to receive a summons first. And they can't attach any assets unless they get a judgement.

talaniman · Mar 27, 2008, 09:24 AM

Statute of Limitations for Debt Collection

Hope this helps you

bassmana · Mar 27, 2008, 05:01 PM

Thank you all for the replies, they are very helpful. I think I'm going to ask our family lawyer if we need to do anything or just ignore the collection agency.

After talking to my wife further about the situation, I've found that the original debt was either late 2000 or early 2001. The repo took place sometime within a year of the original debt and it was turned over to collection (written off?) before the end of 2003. That should have it beyond the SOL the way I've got it figured. Is there a way to find out when the debt was written off?

bassmana · Mar 27, 2008, 05:03 PM

I should have added that the loan was defaulted on (my son quit making payments) on well before the end of 2001.

Thanks again

Bassmana

talaniman · Mar 27, 2008, 07:43 PM

To my knowledge, it goes back to the last payment made.

bassmana · Mar 27, 2008, 08:32 PM

Thanks again everyone, I appreciate the answers.

talaniman · Mar 28, 2008, 05:04 AM

Texas Wage Garnishment

Wages cannot be attached or garnished, except for child support.
Income that is not a wage can be garnished or ordered turned over to a receiver.
Bank accounts, rents and royalties can be garnished.
Exemptions include social security benefits.
WARNING For individuals living in Texas who are paid from an out of state location, there is case law (Baumgardner vs. Sou Pacific 177 S.W. 2d 317) to support taking a judgment from Texas, domesticating the judgment in the foreign state, then filing the wage garnishment there. Many creditors have used this strategy successfully.

Wage Garnishments -- Bankruptcy Exemptions -- State Statutes -- Texas WikiAnswers - Does the state of Texas allow garnishment of wages for a repossessed vehicle