Debt Collection Laws in North Carolina

Attorney from George Mason
Patrick Austin, JD

Patrick Austin is a licensed attorney with a background in data privacy and information security law. Patrick received his law degree at George Mason University's Antonin Scalia Law School, where he served as the Editor-in-Chief for the National Security Law Journal.

Edited by Hannah Locklear

Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: There are debt collection laws in North Carolina enacted with the intent to help protect consumers residing in the Tar Heel State from being subjected to inappropriate and harassing debt collection practices. These rights and protections are codified under North Carolina law and federal law.

Suffering through numerous phone calls that seem to occur at all times of the day and night, receiving threatening letters in the mail, and other forms of intimidation and harassment by an unethical debt collector is generally considered to be awful by most people, including residents of North Carolina.

If you find yourself being pursued by such a debt collection agent or agency, there are legal protections under both North Carolina law and federal law designed to protect you while engaging with a debt collector about a delinquent account.

This article provides a comprehensive overview of debt collection laws in North Carolina, including laws pertaining to the statute of limitations.

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North Carolina General Statute § 75-51

In North Carolina, debt collectors must abide by the restrictions and limitations set forth in N.C. Gen. Stat. § 75-51 when attempting to collect on a debt from a consumer. This law expressly states that “no debt collector shall collect or attempt to collect any debt…by means of any unfair threat, coercion, or attempt to coerce.”

More specifically, North Carolina law prevents debt collectors from using unfair debt collection methods, including:

Threatening to commit acts of violence or any other illegal means that would cause harm to a consumer, their reputation, and/or their property, while attempting to collect on a debt;
Falsely accusing a consumer of fraud for failing to pay a debt;
Falsely accusing a consumer of committing a criminal offense for failing to pay a debt;
Engaging in conduct that would tend to cause disgrace, contempt or ridicule of a consumer;
Making or threatening to make false accusations to another person, including any credit reporting agency, that a consumer failed to pay, or has willfully refused to pay, a debt;
Threatening to take an action that is not permitted under North Carolina law.

According to N.C. Gen. Stat. § 75-56, debt collectors who fail to comply with the restrictions described above when engaging with a North Carolina consumer could be held responsible for their misconduct via a civil action.

Sue a debt collector in North Carolina

A consumer could file a legal claim seeking an amount equal to the sum of (i) any actual damage sustained by such person as a result of a debt collector’s violation of N.C. Gen. Stat. § 75-51 and (ii) civil penalties the court may allow of not less than five hundred dollars ($500.00) nor greater than four thousand dollars ($4,000) for each violation.

North Carolina law also requires debt collectors to provide debtors with a written notice containing certain information within five days of the initial communication regarding the debt. This notice should include the amount of the debt, the name of the creditor, and information on the debtor's right to dispute the debt or request verification.

In addition, debtors in North Carolina have the right to request validation of the debt if they believe it is not valid or if there are errors in the information provided. Upon receiving a valid request, debt collectors must provide written verification of the debt, including details of the original creditor, the amount owed, and any additional charges or fees.

You can also take legal action against your original creditor

Creditors also have obligations and limitations under North Carolina debt collection laws. If creditors engage in illegal actions, such as making false statements or misrepresentations, debtors have the right to take legal action against them to seek damages and other remedies provided by law.

Some assets are protected from garnishment in North Carolina

North Carolina also has specific exemptions in place to protect certain assets from being seized or garnished in debt collection cases. These exempt assets typically include a debtor's primary residence, necessary personal property, and certain benefits such as Social Security or disability income. Creditors are prohibited from seizing these exempt assets to satisfy a debt.

For more information on NC wage garnishment laws, check out our guide on how to Stop Wage Garnishment in North Carolina.

The Fair Debt Collection Practices Act applies to North Carolina residents

In addition to the rules and regulations codified in N.C. Gen. Stat. § 75-51 governing debt collectors in North Carolina, consumers are also given legal protections under the Fair Debt Collection Practices Act (FDCPA). This is a landmark, federal consumer protection law governing the practices of debt collectors nationwide.

The statute of limitations on debt in North Carolina could help you win your case

The North Carolina statute of limitations on debt, including credit card debt and medical debt, is three years, as outlined in N.C. Gen. Stat. § 1-52.

Basically, this means a creditor or debt collection agent or agency is provided three years in which to file a debt collection lawsuit against a consumer. Once the statute of limitations has passed, the debt is considered “time-barred” and a debt collector will be unable to seek reimbursement or repayment from you through a lawsuit.

Let’s consider an example.

Example: Taylor lives in North Carolina and stopped paying her credit card bills in 2019 as the world reacted to the COVID-19 pandemic. She received many notices from collectors over the next few years, but she was still trying to catch up with other life expenses. In 2023, she received a Summons and Complaint from LVNV Funding, notifying her that she was being sued for the debt. After some research, she discovered the statute of limitations was three years in North Carolina, meaning she could use this as a defense in her case. She used SoloSuit to respond to the lawsuit and bring up the expired statute of limitations to the court. As a result, LVNV Funding dismissed the case immediately.

The table below further illustrate the statute of limitations on different types of debt in North Carolina:

North Carolina Statute of Limitations on Debt
Debt Type	Deadline in Years
Credit card	3
Medical	3
Student Loan	3
Auto Loan	3
Personal Loan	3
Mortgage	10
Judgment	10
Source: N.C. Gen. Stat. § 1-47 and § 1-52

Key Takeaways

Debt collection laws in North Carolina afford residents with statutory protections and rights to help even the playing field between everyday consumers and large debt collection companies. Here are some key takeaways on this article on debt collection laws in North Carolina:

If you are contacted by a debt collection agent or agency, do not throw your hands up in despair. You have legal rights and protections under both federal law and North Carolina law.
If you are being subjected to harassment by a debt collector, you may have grounds to file a legal action under N. C. Gen. Stat. § 75-51 and/or federal FDCPA to potentially recover compensatory damages and injunctive relief.
Debt collectors can only contact you between the hours of 8:00 am and 9:00 pm. They are also legally prohibited from calling you multiple times per day.
The North Carolina statute of limitations on debt is three years.

If you’ve been sued for a debt in North Carolina, respond to the case with SoloSuit’s Debt Answer form and increase your chances of winning by 7x. Check out this video to learn more:

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