What Happens If You Default on a Credit Card in North Carolina?


Defaulting on a credit card wreaks havoc with your credit score and could land you in bankruptcy court, but North Carolina offers more protection than most areas. That's because North Carolina is one of only a few states that doesn't permit wage garnishment for credit card debt. In addition, under state law you can't be sued for a credit card debt if it's been four years or more since you last made a payment.

Statute of Limitations

  • If your credit card default falls within the North Carolina statute of limitations -- less than four years -- the creditor can sue you. If granted a judgment lien, the credit card company might place a lien on your real estate, motor vehicles or other personal property. The lien stays with the property when you sell or refinance the property, or otherwise attempt to transfer the title. At that point, the lien holder can collect the money owed from the judgment -- including accrued interest.

North Carolina Wage Garnishment

  • Wage garnishment means that an unpaid creditor has sued in court and received a judgment against the debtor. The debtor's employee is then directed to remove a percentage of the debtor's take-home pay and send it directly to the creditor. In North Carolina, that only applies to alimony, child support, taxes, student loan debt and a few other categories -- not credit cards.

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