In April, the Maryland General Assembly approved legislation on consumer debt collection that addresses how statutes of limitation may be calculated against consumers.
Senate Bill 771, which addresses certain “debt buyers” and “debt collectors,” provides that “certain actions may not revive or extend a certain statute of limitations prohibiting a debt buyer or a certain collector from initiating certain consumer debt collection action unless the debt buyer or the collector possesses certain documents.”
The amended legislation states: “Notwithstanding any other provision of law, on the expiration of the statute of limitations applicable to the consumer debt collection action, any subsequent payment toward, written or oral affirmation of, or any other activity on the debt may not revive or extend the limitations period.”
The bill is expected to be signed into law by the Governor and would take effect on October 1, 2016. If approved, covered debt collectors will need to amend their statute of limitations calculations for consumers in Maryland, including with respect to consumer payments, in order to avoid filing untimely collection lawsuits.
Troutman Sanders LLP has extensive experience in compliance and litigation of statute of limitations issues under the FDCPA. We will continue to monitor this development.