Here’s the thing: even a small, partial payment on an old debt can revive the statute of limitations. That can allow the creditor to sue you and get a wage garnishment order so it can take money right out of your paycheck.

If it were the original creditor suing you, you might resign yourself to the situation. But often the company filing the lawsuit is not the original creditor. Many times, the company that originally loaned you the money has long since written off the account, gotten a tax break for bad debt and sold the account to a collection agency. So the entity suing you may be  a collection agency which purchased your debt for 2 or 3 cents on the dollar–or even less.

The Wall Street Journal has done some good stories lately on the debt-buying industry, and has one today about the FTC’s settlement with Asset Acceptance, one of the largest debt buyers. The FTC alleges people were coerced into paying debts beyond the statutes of limitations. In some cases, the FTC contended, Asset Acceptance reported details of the out-of-statute debts to the credit bureaus in violation of federal credit reporting laws.

Most of us feel a moral obligation to pay what we owe. If bad decisions or bad circumstances have left you with unpaid bills, though, you could be stepping on a land mine if you make a partial payment on old debts. Before you pay, you should understand whether the debts are within the statute of limitations. If they’re not, and you still want to pay, consider negotiating a lump-sum settlement that includes the collector’s promise not to resell any portion of the debt. This is tricky business, though, and you should educate yourself thoroughly before you make the attempt. DebtCollectionAnswers.com, a site run by credit expert Gerri Detweiler, is a good place to start.

Answer: Widows and widowers are often advised not to make any big decisions in the first year of their bereavement. Unfortunately, bill collectors aren’t willing to wait that long.

You need to determine your liability for your late husband’s debts. Don’t rely on what collection agents tell you. They may insist you have a legal or moral obligation to pay a bill when you don’t. An experienced probate or bankruptcy attorney can help you sort through the debts to see which ones need to be paid from your husband’s estate, which you may be responsible for and which can go unpaid. Student loan obligations, for example, typically end at death unless you or someone else co-signed the loans.

You also need to make sure you get all the money and property to which you’re entitled. You and your children may qualify for Social Security survivor benefits. (You can find out more at http://www.ssa.gov.) You also may inherit retirement funds and life insurance policies that are protected from creditors. Life insurance policies that name you as a beneficiary, for instance, pass outside your husband’s estate and don’t have to be shared with creditors — again, regardless of what collection agencies may tell you.

Once you’ve sorted out his estate, you can begin rebuilding your financial life for yourself and your children. A fee-only planner can help you get started. You can get referrals from the Garrett Planning Network at http://www.garrettplanningnetwork.com, which represents planners who charge by the hour, or the National Assn. of Personal Financial Advisors at http://www.napfa.org, which represents planners who charge retainer fees or a percentage of assets they manage for you.

Answer: Typically, your delinquent account will be turned over to a collection agency. Not only will your credit scores take a hit, but you may be subject to nasty collection calls as well.

If your time share is paid for, you might consider giving it away. Some people have successfully gotten rid of time shares by listing them for $1 or so on Craigslist or eBay.

If you still owe money on the loan you used to buy the time share, though, giving it away is probably not an option unless you’re able to pay off the loan first.

But a Facebook fan pointed out that not all debt collection calls are based on a legitimate debt:

After my father died, my mother was contacted by someone falsely claiming he owed a medical bill, offering to process the payment over the phone. She knew it was false [because] she handled the bills, so she told them not to call again.

Survivors also should beware of calls from purported charities, claiming that the deceased promised them a donation of some kind.

When it comes to claims against an estate, you’ll want to see proof that the deceased owed the debt or made any kind of financial promise. Don’t take a caller’s word for it.

Answer: When a lender charges off a bad debt, the debt itself doesn’t disappear. The lender is simply declaring that it doesn’t think it will be able to collect. The debt can be sold to collection agencies, which can post the collection account on your credit reports.

The charge-off is what typically does the most damage to your credit scores, although the collection accounts increase the toll.

There are limits to how long creditors can pursue you in court over debts. The limits vary according to each state’s statute of limitations. There is also a limit on how long bad debts can show up on your credit reports (typically seven years and 180 days from when the account first went delinquent).

But debts only disappear when you pay them or have them legally erased in U.S. Bankruptcy Court.

One of the things you should learn from this experience is not to trust a lender to tell you how much you can afford to borrow. The other is that you should always arrange financing in advance before you venture onto a car dealership lot. If the dealership can beat the deal you get from your bank or credit union, great. Otherwise, you’ve got financing you know you can afford.

Answer: The clock on reporting most negative marks begins when the account first goes delinquent and isn’t reset when a creditor or collection agency updates or sells the debt. If the collection agency continues to report the debt after seven years and 180 days passes, you should be able to dispute the entry with the credit bureaus and get it removed from your credit reports.

You also may need to be concerned about your state’s statute of limitations for this debt. This statute affects how long you can be sued over a debt, which can vary from three to 15 years. In some states, the statute can be extended if you make a payment on the debt or even acknowledge it as your own.

If you’re at risk of being sued, you may want an attorney’s advice about how to proceed and whether you should try to settle this account. You can get a referral from the National Assn. of Consumer Advocates at http://www.naca.net. Even if you aren’t at risk of a lawsuit, it could pay to get this debt resolved. As you’ve learned, mortgage lenders typically aren’t willing to lend money to people with open collection accounts on their reports.

Answer: Your brother’s bills are the responsibility of his estate, not your parents. His creditors would have to be paid if he had any assets, but in this case they’re out of luck.

That doesn’t mean they won’t keep trying, however. Your parents could opt to ignore the calls, letters and guilt trips the collectors try to inflict. Or your parents could talk to a probate attorney who is familiar with the laws of the state where your brother died. The state probably has some kind of simplified probate that would allow your parents to legally resolve these bills and put an end to collection activities.

Answer: So you’re surprised that a “very aggressive and threatening” collector suddenly changed the rules on you? It’s time to wise up and realize you’re not dealing with an ethical company.

You need to make an appointment immediately with an attorney who is familiar with the credit and collection laws of your state. You can find a referral through the National Assn. of Consumer Bankruptcy Attorneys at http://www.nacba.org. Many of these attorneys offer free or discounted initial sessions.

All too often, rogue collection agents violate federal and state fair debt collection practices by threatening to sue when they have no intention of doing so or when they are legally barred from filing lawsuits. Your state’s statute of limitations limits how long a creditor can sue over a debt. In some states, people who lose homes to foreclosure also are protected against lawsuits over any remaining mortgage debt.

But your payments may well have extended the statute of limitations under which the collector would be allowed to sue you. That’s why you need an attorney to advise you. You also might want to consult DebtCollectionAnswers.com, a site run by debt expert and consumer advocate Gerri Detweiler, for more help in dealing with collectors.

You were smart not to send the financial information they demanded, because none of that is necessary for a settlement discussion and because the data could easily be used against you. If they’re unethical enough, they could use the bank account information to raid your accounts.

Answer: The collection agencies are violating federal credit reporting laws. Negative information such as charged-off accounts and collections are supposed to be removed from your credit reports seven years and 180 days after the account first goes delinquent (typically when you miss your first payment). Collection agencies are not allowed to “reset the clock” when an account is sold.

You can dispute these accounts with the credit bureaus, but the reselling and illegal reporting may continue. If it does, you will need to contact the collection agencies directly and tell them to stop. If they refuse, you may need an attorney’s help to get them to mend their ways. You can find a lawyer familiar with credit reporting laws through the National Assn. of Consumer Advocates at http://www.naca.net.

You might think that paying the bills would help, but you really don’t want to deal with a collector so unethical that it would change the date on a debt. Such a company is unlikely to deal in good faith, and you don’t want to give it any ammunition to do you further harm, such as access to your bank account (which it could have if you wrote it a check) or even your phone number, since it may start harassing you.

Answer: Many debt collectors buy old debts for pennies on the dollar, and sometimes these accounts come with little documentation about how the debt was incurred, how much it is and who actually owes the money. These debt collectors often cast a wide net when trying to track down the borrower, and sometimes they latch on to the wrong people.

The federal Fair Debt Collection Practices Act specifies that, when challenged, third-party debt collectors are supposed to verify that the debt is legitimately owed by the person they’ve targeted. But the Federal Trade Commission has noted that “the limited information debt collectors obtain in verifying debts is unlikely to dissuade them from continuing their attempts to collect from the wrong consumer or the wrong amount.”

“Many collectors currently do little more to verify debts than confirm that their information accurately reflects what they received from the creditor,” the FTC noted in a February 2009 workshop report. “This is not likely to reveal whether collectors are trying to collect from the wrong consumer or collect the wrong amount.”

The FTC has asked Congress to update the federal law to require that debt collectors at least make a “reasonable” investigation of the consumer’s dispute. So far, though, Congress hasn’t acted.

If you challenge a debt collector and it doesn’t provide proof of the debt, turning to your state’s attorney general or consumer protection office may be your best alternative. Another option is to hire an attorney to fight back against particularly aggressive collectors who may be violating debt collection laws. You can get referrals at the National Assn. of Consumer Advocates at http://www.naca.net.