Rhode Island Debt Relief

Rhode Island Credit Card Debt law offers creditors one of the longest time limits in the nation for filing suit against debtors for open-ended debt. Creditors are given 10 years in Rhode Island, when many states only offer three. The time limit, or Statute of Limitations (SOL), starts when the debtor first fails to make a scheduled payment, but starts over upon any subsequent partial payments. If a summons is served on the debtor, an answer should be sent by certified mail within 20 days to avoid default judgment in favor of the creditor.

Judgment Enforcement

Rhode Island judgments stay in force for 20 years, accruing interest at 12% annually. Creditors must wait 48 hours to execute the judgment, but cannot wait more than 6 years to take the action. The creditor may levy both personal and real property to satisfy the judgment, but the court must file the lien with the appropriate town or city clerk. Homestead exemption is allowed up to $150,000. Certain personal property exemptions are also allowed.

Rhode Island creditors may garnish wages, but only up to 25% of disposable income after deduction of taxes, social security and disability contributions. The wages of anyone who has collected social security or state aid in the past year cannot be garnished.

“Judgment by Confession,” contract clauses allowing for automatic judgment in favor of the creditor, are recognized in Rhode Island, with certain limitations on Mortgage Lenders and brokers. Residents should be aware of such clauses when signing credit card agreements because the clause removes any potential defenses the debtor may wish to invoke.

Debt Settlement

A Debt Settlement payment may be the best choice available to those facing a debt lawsuit. These agreements allow for interest free payment plans, rather than court-ordered seizures and garnishments.