We recently wrote up on the concept of Time Barred Debts. This is an important concept to understand because the law treats different types of debts…well…differently. So, lets go down the list of the major types of ‘contracts’ so that we have a better understanding of which type of contract our debt falls into.
Oral – These are the most easily understandable contracts. Basically, I say I will pay you back. We don’t have anything in writing, it’s just a Scout’s Honor kind of thing.
Written – These are some of the most common contracts. We ‘Sign on the dotted line’. We agree to the terms and conditions of payment. This is what happens when we go into the hospital and accrue medical debt.
Promissory – These are contracts like School Loans and Mortgages. It is a written agreement stating that you would pay the debt back by a certain debt and time.
Open Ended Account – These are debts that we pay back, and then have the ability to take money out again. These are credit lines. They are revolving debts.
Hopefully this helps.
If you have further questions, give me or Scotty a call @ 505-327-9225
Have a great day!!