Final answer:
The term defining the maximum time for collecting a debt is the statute of limitations, which varies by state and debt type and restricts creditor's ability to legally enforce payment through courts after a certain period.
Step-by-step explanation:
The term that defines the maximum time that a debt can be collected from the time it was incurred or became due is the statute of limitations. This legal concept sets a deadline on how long creditors have to initiate a suit to collect the debt.
The correct answer is Statue of Limitations. The Statue of Limitations is a legal concept that defines the maximum time within which a debt can be collected. Once this time limit has passed, the creditor loses the right to sue for the debt.
Once the statute of limitations on the debt has expired, creditors typically can no longer legally force payment through the court system.
The length of time for the statute of limitations can vary by state and type of debt. It is important for consumers to be aware that certain actions, like making a payment or acknowledging the debt, can sometimes reset the clock on the statute of limitations.
Therefore answer is C-STAUE OF LIMITATIONS.