Is there a interest rate limit on loans in Mo. such as Home water treatments, vacumes etc.?

My husband and his ex wife perchaced a vacuum in 1997 and then was divorced in 2001 . She kept the vacuum and nothing else was ever thought of concerning this item…..As of yesterday my Husband received a letter from an att office stating they are wanting to collect 20,000 plus for a loan that was given for a 1,200 vacuum that was perchaced in 1997 ..OMG!!! He has never received a one letter from the company or statement in 11 years…He perchaced a home in Aug 2007 and his credit didn’t have a negative thing on it much less a 20,000 outstanding balance from anyone! What the heck??? Question is how can this be if after all these years they NEVER tried to contact him or did they ever put it against his credit etc in 11 years????? He is an On Air Personality in town so it isn’t like he is hard to locate… I am at a total loss as well as he is…WHO IN THERE RITE MIND WOULD let a loan add up to over 20,000 for a vacuum cleaner when they have great credit otherwise??? What can be done ?
Times are rough with us as I am sure MANY families can relate to now days ..I have been disabled for a few years now so we struggle to make it on one income …Thus making payments of 300 plus a mth on a 20,000 vacuum he doesn’t even have is WAY beyond our means….We need advice PLEASE! We have pride and have fought so hard to be where we are to loose it all over a 20,000 vacuum ! ( We do not live extravagantly FAR from – just clean and modest )

Is there anything in the law about not reporting this sooner or getting a hold of him sooner where he could take care of this? how can it be possible to sue for 20,000 on a 1,200 dollar vacuum when they never once tried to contact him or report it to the credit bureau ? and how can that much interest be legal? So many questions here

Thanks for your time

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One Response to “Is there a interest rate limit on loans in Mo. such as Home water treatments, vacumes etc.?”

Dave:

July 5, 2010 at 12:02 am

Missouri has a 10 year statute of limitation on civil actions to recover debt created by written contract. What this means is if the contract was created in January of 1997 and they paid on the contract until July of 1998, the statute of limitations begins in July 1998 because that’s when the default occurred. The creditor or any following junk debt buyers have 10 years from when the statute of limitations begins (July 1998) to attempt to collect this debt, including filing a law suit.

You need to find out when the last payment was made on this debt. Send a certified letter back to the attorney disputing the debt. State that you have no knowledge of this debt (the original debt was for $1,200, not $20,000) and want proof that you owe the amount being claimed. Also, let them know it’s not convenient to receive phone calls regarding the matter at any time and they may contact you via postal mail at your current address.

Interest terms were established in the original contract, so unless there are state laws to the contrary, the contract is the last word on the amount of interest they can legally collect.

Don’t worry about the interest for now. On a debt this old, the collector probably can’t validate it so it wouldn’t matter how much they are asking for. My guess is that once the attorney gets your dispute notice, you won’t hear anything more from them.

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