Information on How Long a Judgment Will Last
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- 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.
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
Struggling with debt?
Debt is used to buy a home, pay for bills, buy a car, or pay for a college education. According to the NY Federal Reserve total household debt as of Q4 2023 was $17.503 trillion. Auto loan debt was $1.607 trillion and credit card was $1.129 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%.
Collection and delinquency rates vary by state. For example, in Mississippi, 17% have student loan debt. Of those holding student loan debt, 11% are in default. Auto/retail loan delinquency rate is 8%.
To maintain an excellent credit score it is vital to make timely payments. However, there are many circumstances that lead to late payments or debt in collections. The good news is that there are a lot of ways to deal with debt including debt consolidation and debt relief solutions.
