Learn Oregon's Rules For Garnishment, Liens, and Foreclosure
A lender, collection agent or law firm that owns a collection account is a creditor. The law gives creditors several means of collecting delinquent debt. But before a creditor can start, the creditor must go to court to receive a judgment. See the Bills.com article Served Summons and Complaint to learn more about this process.
The court may grant a judgment to the creditor. A judgment is a declaration by a court the creditor has the legal right to demand a wage garnishment, a levy on the debtor’s bank accounts, a lien on the debtor’s property, and in some states, ask a sheriff to seize the debtor’s personal property. The laws calls these remedies. A creditor granted a judgment is called a judgment-creditor. Which of these tools a judgment-creditor will use depends on the circumstances. We discuss each of these remedies below. See the state-published document How To Protect Your Assets From Creditors In Oregon (PDF) for additional reference.
Oregon Wage Garnishment
The most common method used by judgment-creditors to enforce judgments is wage garnishment, in which 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.
Oregon allows wage garnishment. Oregon follows federal rules, and exempts 75% of the judgment-debtor's disposable earnings (ORS 18.385 and ORS 18.627). It is unlawful to terminate an Oregon employee because of a garnishment or a support order (ORS 18.385(9) and ORS 25.424(6)(a)). Employers may charge employees a processing fee of $2 for each week or portion thereof during which garnishment payments were made to the garnishor (ORS 18.736).
Levy Bank Accounts
A levy means the creditor has the right to take non-exempt money in a debtor’s account and apply the funds to the balance of the judgment. 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.
Oregon allows bank account levy, which state law refers to as "writ of garnishment" (2015 ORS 18.830¹ ). A consumer can file a Challenge to Garnishment (Form 1140) to stop the account account garnishment (ORS 18.700).
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.
In Oregon, a judgment lien can be attached to real estate and not personal property. (ORS Chapter 87 and 18.150 to 18.162 and 18.180). A judgment-creditor in an automobile-related case may ask the court to order the Oregon DMV to suspend the judgment-debtor's drivers license.
If you reside in another state, see the Bills.com Liens & How to Resolve Them article to learn more.
Oregon Statute of Limitations
Each state or commonwealth has its own statute of limitations on civil matters. Here are some of Oregon’s statute of limitations for consumer-related issues:
|Credit card||6||Unifund CCR Partners v. Eric S. Deboer (Oregon Court of Appeals Docket A144530 March 28, 2012) and Unifund CCR Partners v. Rigoberto Porras (Docket A146957 March 28, 2012)|
|Spoken contract||6||ORS 12.010|
|Written contract||6*||ORS 12.080|
|Promissory note||6||ORS 12.080|
|Judgment||10||ORS 12.070 and 18.150 to 18.162, and ORS 18.180|
|* 10 years for "sealed instrument" (ORS 12.070)
When the statute of limitations clock starts depends on the circumstances and the particular statute. In Oregon, the clock starts "after the cause of action shall have accrued, except where a different limitation is prescribed by statute" (ORS 12.010). The clock may be paused (called "tolled") under some circumstances, or renewed (ORS 12.160).
A lender will foreclose either judicially or non-judicially in Oregon. Non-judicial is preferred or customary. This takes 150 days, typically. Lenders are allowed to collect a deficiency balance. See ORS Chapter 88 to learn more. (Note: In late 2013, Oregon amended its rules regarding foreclosure avoidance measure notices, which are found in ORS Chapter 304.)
Oregon Unlawful Debt Collection Practices Act
Collection agents must register with the state. The Oregon Unlawful Debt Collection Practices Act (OUDCPA) mirrors the FDCPA in most respects, with several exceptions.
- Original creditors are covered by the OUDCPA, and not just collection agents.
- Creditors cannot call your employer about the debt or call you at your place of work if you have notified the creditor not to.
- Creditors may call you at work only after he or she has in good faith, but unsuccessfully, tried calling you at home during the day or between 6 p.m. and 9 p.m.
- Creditors can write to you at work only if your home address is not available.
- Creditors may contact you at work only once a week.
Violation of the OUDCPA is not a criminal matter. If you have been victimized by a collection agent or original creditor, file a complaint with the Oregon attorney general and the FTC. Consult with a lawyer to discuss filing a civil lawsuit against the collection agent. Some lawyers take these cases on a contingency basis, which means no out-of-pocket costs to you. These laws are found in Oregon § 646.639 through 646.643.
Consult with a Oregon lawyer who is experienced in civil litigation to get precise answers to your questions about liens, levies, garnishment, and foreclosure.