According to Title 35, Chapter 11, Article 5, the state of Alabama allows for wage garnishment and account levies as a common method used by judgment creditors to enforce judgment collections.
Alabama debt relief adheres to federal rules for the total amount of garnishment, which is up to 25% of the worker’s wages. However, under federal law social security benefits or pensions are not subject to garnishment.
In addition to wage garnishment, the creditor has the right to take levy the debtor’s bank accounts to apply funds toward the judgment balance. Under Alabama law, administrative levy is permissible to recover taxes and unpaid child support.
Creditors who are faced with unpaid debt toward areas of property or home improvement can place a lien against the debtor’s property in an effort to obtain money should the debtor sell or refinance the home.
Title 35, Chapter 11, Section 6-9-211 in Alabama law states, "Every judgment, a certificate of which has been filed as provided in Section 6-9-210, shall be a lien in the county where filed on all property of the defendant which is subject to levy and sale under execution, and such lien shall continue for 10 years after the date of such judgment..."
Alabama Statutes of Limitations
Alabama law allows for up to three years to collect credit card debts, according to State Statute 6.2.37. The SOL on promissory notes is six years. It’s important to note that even with the three-year statute of limitation (SOL), creditors may still pursue debt collection--however they cannot sue you in order to collect the debt.
However in terms of SOL on judgment collections, the state of Alabama has a 20 year SOL on debts and permits the debtor to add a maximum interest rate of 12% to the debt while it remains uncollected or after the judgment has been delivered.
Alabama Credit Card Debt Relief Act of 2010
The Credit Card Debt Relief Act of 2010 has streamlined the methods for repaying debt and regulated how collectors work with debtors. The Act has impacted debt relief collections several ways:
- The number of fraudulent or weak performing credit card companies are gone
- Reduces the chances of falling victim to fraudulent debt settlement companies due to new Federal Trade Commission (FTC) reforms
- Increased, open communication from creditors--more information is provided to help you eliminate your loans\
- Debt settlement companies cannot request upfront fees from clients