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Nevada Collection Laws

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Couple in Nevada dealing with Debt Collections
IN THIS ARTICLE:
  • Examine what kind of collections can occur when you live in Nevada and have a judgment against you.
  • Review Nevada rules for the statute of limitations on debt collection.
  • Consult with an experienced Nevadia attorney.

Learn the Collections Laws & Statutes of Limitations in Nevada

If you owe debt and reside in Nevada, it’s important to understand your rights and liabilities. It is even more important if a creditor threatens to file a lawsuit against you.

A lender, collection agent or law firm that owns a collection account is a creditor. Nevada law gives creditors several means of collecting delinquent debt. These methods include wage garnishment, account levy, and, in some cases, seizing personal property.

Before a creditor may use these legal tools in Nevada, the creditor must go to court to receive a judgment against you. See the Bills.com article Served Summons and Complaint to learn more about this process, and how to fight a lawsuit.

A court will hold a hearing after a creditor files a lawsuit. A hearing may result in a judgment awarded to the creditor. A judgment is a court’s declaration the creditor has the legal right to demand:

The laws calls these remedies. A creditor granted a judgment is called a judgment-creditor. Which tool a judgment-creditor may use depends on the circumstances and Nevada law. We discuss each of these remedies below.

Debt Collectors Calling?

Receiving collection calls is unpleasant, whether from the original creditor or from collection agency. Call 800-998-7497 to speak with a Money Coach and discuss what to say and not to say in a phone call with a debt collector, and also what kind of financial plan you need to avoid this happening again.

Nevada Wage Garnishment Rules

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.

How Big a Bite Can a Creditor Take from Your Paycheck?
In most states, creditors may garnish between 10% and 25% of your wages, with the percentage allowed determined by state law. Garnishment of or for consumer debt is not allowed under federal law, but may be allowed for child support. See the Bills.com article to learn more.

In Nevada, garnishment for child support MUST be given first priority as noted in . 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 , 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 .

Levy Bank Accounts in Nevada

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 . The collection of monies by attaching or levying bank accounts is described under Funds transfers.

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

Lien in Nevada

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 .

If you reside in another state, see the Bills.com 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:

Account/Type Years Statute
Nevada statutes of limitations. Source: Bills.com
Open Accounts 4*
Written contracts 6
Notes Payable 6
Consumer Lease 4
Warranties 6
Debt-Management Services 4
Nevada and Foreign Judgment 6 NRS 17.150 and 11.190(1)(a)
* Under , 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.

The statute of limitation clock starts when the contract is breached. Typically, this means 30 days after the date of the last full payment.

Harassed or Abused by a Debt Collector? Take Action/
Collection agents violate the 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 Spouse Liability For Debt and Community Property Law

Nevada is a community property state, which means courts presume the assets or liabilities acquired by the couple during marriage are community property.

Pre-marital debts do not become community property upon marriage, unlike other community property states (NRS 123.050). Therefore, Nevada seems to follow the idea of “separate” and “community” debt. Except for real estate purchases, both spouses have free reign to incur debt for which the community is responsible (Marine Midland Bank v Monroe, 104 Nev. 307, 756 P.2d 1193 (1988)). However, only half of a spouse’s wages are available to wage garnishment for premarital debt (Rodgers v Rodgers, 110 Nev. 1370, 887 P.2d 269 (1994); Lewis v Hicks, 108 Nev. 1107, 843 P.2d 828 (1992); contra, Phillips v Morrow, 104 Nev. 384, 760 P.2d 115 (1988)). (See the Bills.com article Nevada Community Property to learn more.)

Nevada recognizes the doctrine of necessaries (NRS 123.090), which requires spouses to support each other with their separate property if no community property assets are available. The burden is higher on husbands than it is on wives (NRS 123.100). What is considered a "necessity" is defined narrowly by Nevada courts.

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 lawyer licensed in Nevada and experienced in civil litigation to get precise answers to your questions about liens, levies, garnishment, and foreclosure in Nevada. If you cannot afford a lawyer in Nevada, contact Nevada Legal Services or another Nevada pro bono program to find low- and no-cost legal advice.

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  • M
    malcolm,
    Sep, 2020

    My son has a medical bill in his name and now the collection agency is coming after him? Is that legal? He's 15yrs old.

    • 35x35
      Daniel,
      Sep, 2020

      Malcolm, I am not a lawyer, so can't give you legal advice.

      My opinion is that you are on the hook for the medical care of a minor child, whether you signed any paperwork or not. They should not be coming after the 15-year old.

  • J
    John,
    May, 2020

    I had an overdrawn bank account in Oregon and now reside in Nevada. The account closed in and was sold off in 2012 and now collectors are trying scare tactics saying they are going freeze my personal bank account and taking me to court if I don't play ball. Under the Statute of Limitations, this should drop in court, correct?

    • 35x35
      Daniel,
      Jul, 2020

      John, I can't give legal advice, as only an attorney can properly do so. Here are a couple of thoughts, with the understanding that I am not giving you legal advice.

      If you have not been sued before and the default on the account occurred in 2012 then I believe it would be outside the SOL for either Oregon or Nevada. If, for some reason, the laws of another state were specified to govern the account terms, which seems unlikely, it is possible that the SOL hasn't been reached. It could also be the case that the debt collector will allege that you tolled the account when you moved, not giving them a fair chance to collect. Tolling stops the clock running on the SOL.

      Were I in your shoes I would let the collector know your address, and get their address. If they mail you, validate the debt without delay. Send them a cease communication letter, too.

  • C
    Charles Dodgena...,
    May, 2020

    I received 2 credit cards for two corporations in Nevada. Zions bank in Utah has received a judgement. The letter says the judgement was issued 3/10/20. I did not receive info on the decision until today. The 30 day appeal window is closed. The last activity was 11/12/2014 on one account, the other was 4/25/13 (Corp. closed 5/16). Which state credit card limit of liability time am I bound by? Personal guarantee’s signed.

    • 35x35
      Daniel,
      May, 2020

      Charles, you are asking for legal advice. I am not a lawyer and can't give legal advice. Here are some thoughts with the understanding that you should not consider it legal advice.

      In principle, where you lived when you opened the accounts is important. So is the specific wording of the account agreements. However, Utah and Nevada both have the same SOL on written debt. It would  appear that the one with last actiivty of 2013 would have been an account for which you could have used the SOL a as a defense.

      Post-judgment, you need to look into whether the creditor attempted to serve you notice properly. I suggest you speak with an attorney. You can also try speaking with the court clerk to see if any direction is forthcoming.

  • L
    Leroy,
    Apr, 2020

    I live in Nevada  and have a credit card judgment against me. The court informed me a wage garnishment was carried out in Dec. 2019 and was sent to constable to serve to me at my current employer (in Nevada) They have the correct information on file. I spoke to my employer and they stated they haven’t received anything to this day. Is this normal ? Or am I missing something? I know I doubt they have my home address. I know garnishment is good for 120 days per court website. When does the clock start ticking?

    • 35x35
      Daniel,
      Apr, 2020

      Leroy, as I am not an attorney, please understand that nothing I share is to be taken as legal advice. 

      I have no data on which to give an answer. My guess is that it is not very common for the court to have all the correct information, say that notice was sent to the employer, and for the employer not to receive it. I think you should anticipate the order arriving, know how much you will be left with after the money is taken out of your check, and judge the effect on your ability to pay your monthly obligations at the reduced level of income.

      120 days doesn't end the ability of the judgment-holder to garnish your pay. After 120 days, the garnishment can be renewed. If multiple creditors have judgments against you, perhaps a separate creditor will be in line to start collecting once 120 days have passed on the original garnishment.

  • T
    Theresa Pastrna...,
    Apr, 2020

    I have a payday loan from Dollar loan center which I took the loan out not my husband but they just sent it to collections and also sent my husband too collections his me is not even on the loan I am in Nevada can they even do that. I have several different collections like that but none of them put my husband in collections

    • 35x35
      Daniel,
      Apr, 2020

      Theresa, Nevada is a community property state. That means debts incurred during the marriage to benefit the community are considered community property. They are therefore owed by both spouses regardless of whether both spouses names are on the loan agreement.

    • L
      Letitia,
      Sep, 2020

      Theresa, My husband and I had the same exact thing happen with dollar loan center. Even when my husband was making the payments on time, they refused to remove me until it was payed off. Not sure if all dollar loan centers are like that, but it felt a lot like being held hostage. Bad business in my opinion.

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