Credit card debt can be overwhelming no matter where you are, but it can help to know there are some laws to keep collectors at bay. In New Jersey, there is no state fair debt collection law. Still, residents have federal and state laws that prevent credit card companies from unfairly taking advantage of debtors.
Fair Debt Collection
A New Jersey resident can take advantage of the federal Fair Debt Collection Practices Act. It puts the burden on collectors to verify the debt before they take action against you. If you want it in writing, and don't get it, the collector has to back off. New Jersey's attorney general can take action to prevent unfair practices, or you can sue the collectors in federal court. A victory can be worth $1,000 plus attorney's fees and any money the violation cost you.
New Jersey law prohibits deceptive marketing, which means collection agencies and creditors can't impersonate debt settlement companies. You can skip those companies entirely if you settle directly with the creditor. These agreements are legally binding in Jersey. If a creditor agrees to settle with you, but then tries to collect more than you agreed to pay, you can sue.
Credit Card Lawsuits
Creditors have to notify Jersey residents of any pending lawsuits with an official complaint. You'll have the chance to defend yourself in court. If you're sued and lose, a judge will issue a judgment that could harm your credit. That will make it easier for a creditor to go after your assets and wages. New Jersey has a statute of limitations of six years on credit card debt. If you make a payment, the statute of limitations gets reset.
You don't need to be in the Garden state to know garnishment is a bad thing when it comes to wages. Jersey creditors can't surprise you with one; they must tell you about it and get a judgment against you. However, once one is in place, a creditor can use it against you for up to 20 years. It's federal law that creditors can't take more than 30 times the federal minimum wage or 25 percent of your disposable income, whichever is less. New Jersey limits it to no more than 10 percent if you make less than 250 percent of the poverty level.
- Stop Collector Harassment: New Jersey Debt Collection Laws
- SuzeOrman.com: Managing Debt
- An Attorney's Guide to the Collection of Bad Debts; Robert L. Lewis
- Judiciary of the State of New Jersey: Wage Execution
- BSCAlliance.com: New Jersey Laws on Wage Garnishments, Statute of Limitations on Debt and Bankruptcy Property Exemptions
Van Thompson is an attorney and writer. A former martial arts instructor, he holds bachelor's degrees in music and computer science from Westchester University, and a juris doctor from Georgia State University. He is the recipient of numerous writing awards, including a 2009 CALI Legal Writing Award.