Nevada Collection Laws

What are the collections laws and statutes of limitations for residents of Nevada?

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Bill's Answer: Answered by Mark Cappel

A collection agent or law firm that owns a collection account is a creditor. A creditor has several legal means of collecting a debt. But before the creditor can start, the creditor must go to court to receive a judgment. See the Bills.com resource Served Summons and Complaint to learn more about this process.

The court may decide to grant a judgment to the creditor. A judgment is a declaration by a court that the creditor has the legal right to demand a wage garnishment, a levy on the debtor's bank accounts, and a lien on the debtor's property. A creditor that is granted a judgment is called a "judgment-creditor." Which of these tools the creditor will use depends on the circumstances. We discuss each of these remedies below.

Nevada Wage Garnishment

The most common method used by judgment-creditors to enforce judgments is wage garnishment. A judgment-creditor contacts your employer and requires the employer to deduct a certain portion of your wages each pay period and send the money to the creditor.

Wise Advice In most states, creditors may garnish between 10% and 25% of your wages, with the percentage allowed determined by state law. Garnishment of Social Security benefits or pensions for consumer debt is not allowed under federal law, but may be allowed for child support. See the Bills.com Wage Garnishment article to learn more.

In Nevada, garnishment for child support MUST be given first priority as noted in NRS 31.249 Application to court for writ of garnishment. And, wage garnishment for child or spousal support may be as much as 50% allowable (see #4(a) under NRS 31.295).

In Nevada, wage garnishment is allowed under NRS 31.240, a writ of garnishment may issue at time of issuance of writ of attachment or later. If the judgment-creditor is aware of the debtor's place of employment, it may seek wage garnishment.

Under federal law, the garnishment applies to 25% of the debtor's net take home pay, (i.e. gross pay less statutorily mandated deductions). Garnishment can occur only after the person being garnished has received a 10-day's notice. Additional exceptions to the limitations on wage garnishment in Nevada may be found under NRS 31.295.

Levy Bank Accounts

A levy means that the creditor has the right to take whatever money in a debtor's account and apply the funds to the balance of the judgment. Again, the procedure for levying bank accounts, as well as what amount, if any, a debtor can claim as exempt from the levy, is governed by state law. Many states exempt certain amounts and certain types of funds from bank levies, so a debtor should review his or her state's laws to find if a bank account can be levied. Some states call levy attachment or garnishment.

In Nevada, levy is allowed under Chapter 31 - Attachment, garnishment and other extraordinary remedies NRS 31. The collection of monies by attaching or levying bank accounts is described under NRS 104A.4101 Funds transfers.

If you reside in another state, see the Bills.com Account Levy resource to learn more about the general rules for this remedy.

Lien

A lien is an encumbrance — a claim — on a property. For example, if the debtor owns a home, a creditor with a judgment has the right to place a lien on the home, meaning that if the debtor sells or refinances the home, the debtor will be required to pay the judgment out of the proceeds of the sale or refinance. If the amount of the judgment is more than the amount of equity in your home, then the lien may prevent the debtor from selling or refinancing until the debtor can pay off the judgment.

Under Nevada statute, liens against a debtor are allowed. For more information on the types of liens allowable under Nevada law, please refer to Chapter 108 - Statutory Liens.

If you reside in another state, see the Bills.com Liens & How to Resolve Them article to learn more.

Nevada Statute of Limitations

Each state has its own statute of limitations for consumer-related issues. Here are some of Nevada’s statutes of limitations:

* Under NRS 97A.060, a credit card is defined as an open account. However, one circuit court interpreted this statute to mean a credit card account founded upon a written agreement qualifies for the 6-year statute of limitations (Marshall v. Kleppe, 637 F. 2d 1217, 1244 (9th Cir. 1980)). Reno and Las Vegas justice courts have reputations for applying 4-year SOL for credit card cases when plaintiff cannot provide written credit card application or agreement.

Wise Advice Collection agents violate the FDCPA if they file a debt collection lawsuit against a consumer after the statute of limitation expired (Kimber v. Federal Financial Corp. 668 F.Supp. 1480 (1987) and Basile v. Blatt, Hasenmiller, Liebsker & Moore LLC, 632 F. Supp. 2d 842, 845 (2009)). Unscrupulous collection agents sue in hopes the consumer will not know this rule.

Nevada Mortgage Foreclosure

If you are at risk for foreclosure, check out the State of Nevada's Hardest Hit Fund page. Nevada Chapter 1-7 — Deeds of Trust governs foreclosure and deficiency balances. Under Nevada law, the lender may recover any deficiency balance. However, if your servicer participates in the HAFA program, then it is barred from collecting a deficiency balance.

Nevada offers simple and effective foreclosure mediation for distressed homeowners who face foreclosure. See the State of Nevada Foreclosure Mediation Program (FMP) pages at the Supreme Court of Nevada's Web site for details. If you receive a Notice of Default (NOD), consult with a Nevada lawyer who has experience with FMP. Eligible homeowners have 30 days after receiving a NOD to request mediation. At minimum, working within the FMP puts a hold on foreclosure during the mediation process. Homeowners in the FMP are advised to continue to pay their property taxes and insurance.

Recommendation

Consult with an attorney licensed in Nevada and experienced in civil litigation to get precise answers to your questions about liens, levies, and garnishment in Nevada.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com

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Comments (67)


S. R.
Henderson, NV  |  April 03, 2014
I am being sued by a banking institution for an overdraft from 2010. I currently have not been employed since 2011 and am in the process of fighting for disability. I personally do not have an income, yet my youngest child receives SSI. The only asset I own is an older car valued at about $2,000. Can they garnish my son's SSI since I am the representative payee. Or can they not touch his money?
Bills.com
April 04, 2014
Read the Bills.com article When Creditors Are Allowed To Garnish Social Security Benefits to understand more about the laws in place that protect Social Security benefits.

You mentioned you received notice of a lawsuit. Consult with a lawyer to defend yourself. If you cannot afford a lawyer, contact Nevada Legal Services or another Nevada pro bono program to find a no-cost legal advice.
Abbey C.
Las Vegas, NV  |  April 02, 2014
I have a repossession on my credit report since 2008. I lost my job and didn't have the means to pay for it. Just recently the creditor keeps adding a negative mark on my credit report EVERY MONTH. I was told I had a judgment against me but I can't find it anywhere in the court in my state. Every month however I see them posting a negative mark. Does the state of NV have a Statute of Limitations and if they file every month to my credit report does that start the time off again? I know they have 7 years and this year will be the 7th year.
Bills.com
April 04, 2014
I think you have two separate issues here:
  • The repossession. This can be reported on your Equifax, Experian, and TransUnion credit reports for 7 years from date of delinquency. You mentioned 2008. When exactly did the repo occur? Add 7 years to that date, and that is when the repo will fall off from your credit report.
  • The judgment. You mentioned you cannot find a Nevada court with this on file. How did you look? You may not be able to find it online, as some rural Nevada counties do not have Web sites publishing this information. Did you visit your local courthouse in person to see if a judgment is filed in your name there?

What to do? If no judgment exists, send the consumer credit reporting agencies that publish this information, including Equifax, Experian, or TransUnion, a dispute about your phantom judgment.

You mentioned Nevada's statute of limitations. Assuming for the sake of argument that a judgment against you really exists, Nevada's statute of limitations for judgments is 6 years. This means the judgment-creditor can use the judgment as a tool to garnish your wages, levy your bank accounts, place a lien on your real property, or ask the sheriff to seize and auction your non-exempt personal property for 6 years from the date the judgment was filed.

Under the Fair Credit Reporting Act, Equifax, Experian, and TransUnion can report this judgment on your credit reports for the length of time a judgment is valid in a consumer's state, or 7 years, whichever is longer. Therefore, Nevada residents will see judgments reported on their credit reports for 7 years.

Nicole M.
Las Vegas, NV  |  January 28, 2014
I have a student loan that says closed and also states claim filed with government for insured portion of balance on loan. I did for a couple years get my tax returns taken that paid towards these loans so I know they were paid but they were paid off through a different collection agency. My question Is when does this fall off my credit report? I defaulted in Jan 2008. is it still 7 years or does Nevada have a law that it stays there longer?
Bills.com
January 28, 2014
Your residing in Nevada is not an issue. The account should fall off your credit report 7 years after the date of first default. If it does not, file a dispute to have it removed. See the Bills.com article How Long Student Loans Appear on Credit Reports to learn more.
Jose M.
North Las Vegas, NV  |  January 24, 2014
We had a house and it was foreclosed in June 2012. We were issued 1099C by the lender. It was a single loan (one lender). Now, we are trying to buy a home on cash basis using our money (from 401K loan, Vehicles title loan, and savings we made during last 2 years). My worry is, would the previous lender come after us and put a lien on the property. What is Nevada's law on this issue. Is there any way by which I can protect my property. Thanks
Bills.com
January 27, 2014
Real property in your name is at risk of a lien from a judgment creditor. Consult with a Nevada lawyer who has mortgage and/or real property experience. Ask if titling the property in a trust would insulate the property from a judgment creditor.
George A.
Las Vegas, NV  |  January 03, 2014
A judgment in Oregon was rendered in 1994 (10 year limit unless renewed), and was renewed in 2004 (a final 10 years added). In 2008 a foreign judgment based on the same case was filed in Nevada. In early 2014 the 20 year Oregon judgment expired. Is the Nevada foreign judgment still valid after the underlying judgment expired in Oregon?
Bills.com
January 06, 2014
I can find nothing in the NRS or Nevada case law — although I hasten to add my research on case law was limited — to suggest a sister-state judgment domesticated in Nevada expires when the originating judgment expires. It appears the two operate on their own clocks, as it were. The NRS is clear it will not permit an expired sister-state judgment to be domesticated, but those are not the facts here.

Consult with a Nevada lawyer who has civil litigation experience for a legal opinion on this matter.
David S.
North Las Vegas, NV  |  January 01, 2014
I just recently found out my wages are being Garnished at 25% for an apartment debt from 2003 the credit collection company ALLIED COLLECTION SERVICES said they summoned me in the local newspaper in 2003. The debt is $4,300 after all of their fees and interest charges. The only arrangement allied will work out with me is pay them $4,000 saving me $300 WOW..I have never received a phone call or letter stating I have a court date or that I am being sued in the past 10yrs according to my knowledge. The only reason I found out about this garnishment is I received and email from mypay site telling me it's about to start. Also this creditor (Never) appeared on my (Credit Bureau). Well at this point I'm shocked over this whole deal. Please is there anything I can do to have this garnishment stopped I was never informed of anything except the garnishment. I feel very Violated and invaded of my privacy, what can you recommend with this type of situation. Thank you for all your help.
Bills.com
January 03, 2014
Consult with a Nevada lawyer who has consumer law experience immediately. I am unclear on the timeline you shared, so I would not serve you well by offering further thoughts on your legal situation. Ask your lawyer if you have any legal argument to vacate the judgment based on a defective service of process.

The fact a judgment appears or does not appear on your credit reports has no legal weight or consequence. Courts are not obligated to share information with the consumer credit reporting agencies, which include Equifax, Experian, and TransUnion. It would not surprise me to learn lawsuit information from Nevada's rural courts would not find its way to the credit bureaus.
Daleen B.
Saint Peters, MO  |  December 10, 2013
Washoe Co is trying to collect a Juvenile debt from 2006 that I was never informed of. I am the mother of the juvenile so they tell me even tho all the services were court ordered I am responsible to pay. The debt is $500.00 but I was never told and signed nothing saying I understood that I had to pay for the services including the house arrest. After 7 years they are now just contacting me about this. I have only been out of the state for 21 months and in all the time I lived in Reno I NEVER heard from the county. Do I still have to pay this?
Bills.com
December 11, 2013
This is a frustrating situation. What you are hoping to find is a statute of limitations or estoppal defense you can use to argue that because Washoe County sat on its rights for 7 years, the debt may no longer be collected.

Alas, I know of no statute of limitations that applies here, which leaves you with an estoppal argument. Consult with a Reno-area lawyer who has consumer law experience to learn if this theory has even a thin thread of hope.

Readers, if you know of a Nevada statute of limitations rule or case law that applies to a facts like these, please share your citations below.
Stacy S.
Alturas, CA  |  November 26, 2013
My husband and I are starting the home buying process. I have a judgment against me dated November 30, 2007 (the date it was filed). We are trying to decide if we should try to settle now but we are scared to open that can of worms if the creditor doesn't want to settle and instead wants to come after us for the whole amount ($3,200). Or should we wait until for the 7-year mark, which is November 30, 2014. Will it come off my credit at that time?
Bills.com
November 26, 2013
The statute of limitations for a Nevada judgment is 6 years, but Nevada judgments can be renewed. The renewal must take place within 90 days before the date the judgment expires. Here, based on the information you shared, if there is no renewal as of November 30, 2013, the judgment will expire. In December 2013, call the court clerk's office for the court that issued the judgment in 2007. Ask if the judgment was renewed. If it was not, then you are in luck. If the judgment was renewed, then the judgment-creditor has expressed its desire to collect on the debt.

The rules for our credit reports are set by the federal Fair Credit Reporting Act. Under the FCRA, judgments can appeal in our credit reports for 7 years or the debtor’s state statute of limitations on judgments, whichever is longer.

Let us say for the sake of argument the judgment-creditor sat on their rights and did not renew the Nevada judgment. If so, then the judgment will fall off your credit reports on November 30, 2014. However, if the judgment-creditor renewed the judgment, it will remain on your credit reports until November 30, 2020.
Hillary V.
Fernley, NV  |  November 13, 2013
My husband has been attempting to negotiate with a collection agency over a credit card debt. He wants an agreement sent to him in writing and will then pay them with a money order since we don't want our checking account info in their files. They refuse to go this route and are insisting on info over the phone. They also lied about how they got the phone number because they said it was on the account and we have moved and changed numbers since debt collection attempts began. We would never volunteer the info to them. They also refuse to give an address so we can send a cease and desist letter. Any suggestions?
Bills.com
November 14, 2013
You and your husband are right on point. You should absolutely NOT give payment info over the phone, with nothing in writing. What collection company is this? If you supply the name, I will see if I can find an effective way for you to reach a supervisor there.
Tim H.
Boise, ID  |  October 09, 2013
I have a collection on my credit report which I believe is from a medical emergency I had in 2007. I called the number on my credit report because I want to pay it. I requested a letter stating what I owe and for what, and was told they don't do email and they can't send letters out of state. (I am in Idaho). Kind of annoying when you want to pay a debt in full. Any advice?
Bills.com
October 09, 2013
It is difficult to understand why you're encountering a barrier when you offer to pay an old debt. My guess — note that word choice — is the collection agent you contacted is not licensed to operate in your state, and a red flag popped up on the collection agent's screen when he or she accessed your account. Collection agents buy accounts in bulk, and your account may be uncollectable for that particular collection agent for some reason.

Learn your state's statute of limitations. If it has passed, you could avoid paying the debt, even if you are sued, by using the statute of limitations as a defense.

If the statute of limitations has passed, you may wish to pay the debt, for your own reasons, if you choose.

The other issue to keep in mind is that the debt should fall of your credit report on its own, 7 years after the date you first defaulted.
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