By: Daniel Stone
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How do creditors collect in South Carolina?
Many of my clients come to my office due to a creditors’ efforts to collect on their debt. Let’s take a brief look at some of the ways creditors can collect on their debts in South Carolina. First, lets examine some basic guidelines that apply to collections for South Carolina. The first guideline is that South Carolina does not have wage garnishment. Please note there are many exceptions I have spelled out in a prior blog. Second, some creditors have more collection powers than others. An example of this is the federal government. The federal government can execute wage garnishment and the IRS tax liens generally have more powers than other liens.
Second, let’s examine how credit card companies can collect on their debts. First, they will do what any creditor would do- call and harass to get you to pay. If this does not work the loan is sent to collections. In some cases the creditor will ultimately sue in South Carolina state court to obtain a civil judgment. If you own a house, the judgment will attach to your home for ten years. For many people, the collection efforts by the creditor will end there. However, some creditors will go the final step of seeking collection of their judgment in a supplemental proceeding in state court.
Prior to the supplemental hearing, judgment holders are required to send an Execution demand to the local sheriff. In most cases the sheriff will send a letter to the debtor requesting that they come see them in regards to the assets. In some cases the sheriff’s office will actually come out to your property to search for assets. After the sheriff’s office finishes their inquiry, they usually send a NOL PROS letter back to the creditor. This means there was no assets to recover. In a supplemental proceeding, creditors are able to demand a debtor to bring important records such as bank statements and prior tax returns to the hearing. At the hearing the creditor can ask any question they want in regards to the debtors assets. Please note if you don’t attend this hearing you will most likely be held in contempt and a warrant could be issued for your arrest.
Third, many medical creditors have collection powers in South Carolina that other creditors do not have. Pursuant to the GEAR program, many state hospitals and medical providers can pursue patient SC state tax refunds to pay an outstanding tax debt.
Finally, there are many other types of debts this article does not address such as finance loans, child support, student loans, and many other. If you have a debt collector calling you, please call me to discuss your rights.