Information on How Long a Judgment Will Last

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Daniel Cohen

UpdatedSep 20, 2024

Key Takeaways:

Review how your state affects how long a judgment stays in force.
Understand that a judgment can be renewed by the creditor.
Consider a bankruptcy as a way of discharging the judgment-debt.
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My spouse has a judgment against him for an unpaid bill. Is there a time limit as to how long this judgment is open?

My spouse has a judgment against him for an unpaid bill. We lost a business in NC. Is there a time limit as to how long this judgment is open? The amount is for equipment with a substantial amount of money owed.

North Carolina law allows a judgment creditor to try to collect on its judgment for ten years; in addition, creditors holding judgments can petition the court which entered the judgment to renew the judgment before the initial ten years expires. As long as the judgment creditor keeps up with the renewal process, the judgment can be renewed indefinitely until the judgment is paid. However, many creditors do not effectively track the expiration of their judgments, so if the creditor does not file for renewal, it is possible that your husband’s judgment will expire after the initial ten years.

To read about the various statutes of limitations for the collection of judgments, and the renewal procedure in various states, see the Bills.com statute of limitations and state collections laws page.

You state that you lost a business in North Carolina, but your question is unclear as to whether or not you currently live in NC or if you have moved to a different state. The state of your residence is important, as it impacts what action the creditor can take against your husband to enforce this debt. For example, North Carolina generally does not allow wage garnishment for the enforcement of civil judgments, which could make enforcing the judgment against your husband much more difficult. However, if you have moved to a different state, the creditor could file a motion to domesticate its NC judgment in your new state of residence, and then could enforce its judgment under the new state’s laws, which, in most states, allow for wage garnishment, levying of bank accounts, etc. I encourage you to consult with an attorney in your area to discuss the judgment against your husband and what action this creditor can take to enforce its debt.

If the judgment is as large as you seem to indicate in your question, your husband may need to consider filing for bankruptcy protection. In many cases, people whose businesses have failed are forced to file bankruptcy due to the overwhelming debt that can result from an unsuccessful business venture. Filing for bankruptcy protection could allow your husband to either completely discharge this debt (Chapter 7 bankruptcy), or to work out a plan to pay back at least a portion of the debt (Chapter 13). A bankruptcy may also provide you and your husband an opportunity to resolve any other outstanding debts you and your family may owe. Which type of bankruptcy would be best for your family depends on many factors, including the type of debt you owe, your income, and other creditors. If you and your husband are considering filing for bankruptcy protection, I strongly encourage you to consult with a local attorney to discuss what bankruptcy options may be available to you. I also invite you to visit the Bills.com bankruptcy resources page.

I wish you and your husband the best of luck in finding a workable solution to resolve this debt.

I hope that the information I provided helps you Find. Learn. Save.

Best,

Bill

Bills.com

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Dealing with debt

If you are struggling with debt, you are not alone. According to the NY Federal Reserve total household debt as of Quarter Q1 2024 was $17.69 trillion. Student loan debt was $1.60 trillion and credit card debt was $1.12 trillion.

According to data gathered by Urban.org from a sample of credit reports, about 26% of people in the US have some kind of debt in collections. The median debt in collections is $1,739. Student loans and auto loans are common types of debt. Of people holding student debt, approximately 8% had student loans in collections. The national Auto/Retail debt delinquency rate was 4%.

The amount of debt and debt in collections vary by state. For example, in Arkansas, 35% have any kind of debt in collections and the median debt in collections is $1553. Medical debt is common and 18% have that in collections. The median medical debt in collections is $561.

Avoiding collections isn’t always possible. A sudden loss of employment, death in the family, or sickness can lead to financial hardship. Fortunately, there are many ways to deal with debt including an aggressive payment plan, debt consolidation loan, or a negotiated settlement.

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10 Comments

GGee, Apr, 2014

I had a judgment against me that was held by an original creditor. The judgment was effective in May 2012. I was making payments to them, no payment agreements were in writing - only verbal, but I missed two payments. They wrote to me saying they were going to enforce the judgment, then sold the debt to a licensed debt buyer. The debt buyer recently wrote to me trying to collect the debt and threatening to enforce the judgment. Can the original creditor's rights in a judgment be transferred to a debt buyer?

BBill, Apr, 2014

Yes, a judgment-creditor can sell a judgment, which includes any rights to enforce the judgment in accordance with state laws.

TTujuana, Apr, 2012

I had a judgement filed against me back in 2004/2005 for an outstanding credit card from 2001. I moved to NC in 2003/2004 and the address that was listed prevented me from receiving documentation stating I had to go to court. The debt was brought by first resolution and they hired an attorney here in Charlotte, NC. I was in the process of fixing my credit and the sheriff came and handed me a writ of execution and had my car towed away. The judgement is not showing on my credit report because it fell off in November, 2011. Do they still have a right to take my property even though the judgement is no longer showing on my credit report? I thought that after 10 years the it was dissolved. I called and try to see what I could do to resolve the debt and the attorney off was rude and stated that my car would be auction of on 04/30/2012 at 1:00 pm. The debt was twice as much as the original amount of the debt. Is there anything I can do the attorney I spoke to basically stated that Bankruptcy is the only option is that true?

BBill, Apr, 2012

Think of a credit report as a specialized newspaper where the credit reporting agencies publish information reported to them by creditors. The information may be accurate or not. Creditors may or may not choose to give their information to the credit reporting agencies. A debt appearing on your credit report does not mean you owe the debt because the creditor may have made a mistake in its report. The opposite is also true: Just because a debt does not appear on a credit report does not mean you do not owe the debt. A credit report is not an official legal ledger where all of a consumer's debts are recorded and published.

You mentioned you were never served with a summons regarding the creditor's lawsuit. Also, you seem surprised by the sheriff appearing to seize your vehicle, which tells me you were given no notice of the judgment. For these two reasons, consult with a lawyer in your state who has consumer law experience immediately. You may be able to vacate the judgment due to the plaintiff not following your state's civil procedure rules.

BBill, Feb, 2010

See the Bills.com resources Collections Advice to understand the rights of creditors and debtors regarding debt. As for the Social Security question, see Social Security Garnishment.

nnick, Mar, 2011

hi i have a chapter 7 bankruptcy and 1 judgement ageist me which i have set up payment arrangements and a credit line form a future company who is threating to file suit ageist me. they set up credit with me after the bankruptcy and they said if they get a judgement they can come to my house with the sheriff and take property to pay off the debt. i live in Georgia can they do this? also i was out of work for 3 months on FMLA so i'm just returning to work and that is why i couldn't make a payment arrangement at this time. what can i do?

BBill, Mar, 2011

The chain of events you described confuse me, and I wonder why the judgment (or the debt that gave rise to the judgment) was not included in your bankruptcy filing. Consult with your bankruptcy lawyer about the judgment — it may be prohibited under bankruptcy law.

GGinger, Feb, 2010

My husband received civil papers for a judgement on a credit card balance. He only draws an small SS check and I am on unemployment. Can the creditor take personal property, such as vehicle? Can they garnish his SS check? We live in NC, balance is approx 10,000. Any info would be greatly appreciated.

BBill, Jan, 2010

Do not believe legal advice from collection agents. The legal information from collections is usually incomplete or wrong, and is always self serving. You were correct in the phrasing of your message "They claim they have a judgment against me." I may claim to be as handsome as Tom Cruise, but that does not make my statement true. Let us assume for a moment the judgment-creditor has a judgment against you that was given in 1997. (In other words, for the sake of argument let us say you were a party to the lawsuit against your spouse.) The statute of limitations for judgments in North Carolina is 10 years. Assuming you were a North Carolina resident in 1997 and have remained so since, and assuming there was a 1997 judgment, that judgment expired in 2007. Even if the judgment was granted in 1998 or 1999, the judgment-credit is outside of the statute of limitations for collecting on the debt.

Now let us assume that the creditor suddenly and recently realized you were a co-signatory for the loan. Depending on the nature of the loan, the statute of limitations is either three or 10 years. Regardless, the statute of limitations on the contract for the loan has passed. The creditor can attempt to collect the loan. It can file a lawsuit against you. However, the court will dismiss the case if you raise the statute of limitations defense in a timely manner. The statute of limitations defense is not something the court will do for the defendant -- the defendant must raise this defense. If you receive a summons to appear, do so on the date specified and present your evidence to the court. Of course, it would be wise to consult with a North Carolina attorney if you have additional questions or you receive a summons.

KKathy, Jan, 2010

My late husband and I co-signed for a loan in 1997. The statute of limitations for contract loans in NC is 10 years. My husband and I separated in 1997 and he filed bankruptcy shortly afterward. I just received a letter from a collection agency demanding payment of the loan and almost an equal amount in interest. They claim they have a judgement against me. According to the clerk of court, although my name was listed as a party in the proceedings the court only awarded a judgement against my late husband. My name is not on the judgement at all. I am disabled, and my only income is SS and a small Civil Service Death Benefit.Since the statute of limitations has passed and my name was not on the initial judgement, and my husband has passed away, is there any way the creditor can get a judgement against me now, or sue me?