Question 1

What is the statute of limitations on debt in California?

Accepted Answer

4 years for an action on a contract, obligation or liability founded on a written instrument. Once the period has run, a creditor or collector may not sue or start arbitration to collect the debt, and the period can be extended only under the written-acknowledgment rule (CCP § 360).

Question 2

How long can a creditor sue on a credit card debt in California?

Accepted Answer

4 years for a book account, an account stated based on a written account, or the balance of a mutual, open and current account with written items. 2 years for a contract not founded on a writing, such as an oral agreement.

Question 3

Does making a payment restart the statute of limitations in California?

Accepted Answer

An acknowledgment or promise to pay extends the period only if it is in writing and signed by the debtor. A payment on a promissory note restarts the period for that note, but a payment by itself does not revive a debt that is already time-barred.

Question 4

How long does a court judgment last in California?

Accepted Answer

A money judgment can be enforced for 10 years from entry and can generally be renewed for another 10 years by filing an application. For personal (consumer) debt judgments under $50,000 and medical debt judgments under $200,000, the creditor may renew only once, for 5 years (for applications filed after 2022).

Question 5

How much of my wages can be garnished in California?

Accepted Answer

The lesser of 20% of weekly disposable earnings, or 40% of the amount by which weekly disposable earnings exceed 48 times the state minimum hourly wage (or the local minimum wage if higher where the debtor works). This is stricter than the federal limit.

Question 6

How much money in a bank account is protected from creditors in California?

Accepted Answer

$2,325 per debtor in deposit accounts is exempt automatically, without filing a claim (effective July 1, 2026). The amount equals the state's minimum basic standard of adequate care for a family of four (Region 1) and is adjusted every July 1. Higher automatic amounts apply to directly deposited Social Security or public benefits. The automatic exemption does not apply to levies for child or spousal support, wages owed, or state tax collection.

Question 7

What is the homestead exemption in California?

Accepted Answer

The greater of $300,000 or the countywide median sale price for a single-family home in the prior year, capped at $600,000. Both figures are adjusted every January 1 for inflation (California CPI), beginning in 2022.

Question 8

Can a creditor take my car in California?

Accepted Answer

$8,625 in combined equity in motor vehicles (and proceeds from their sale or insurance), effective April 1, 2025. The statute's base figure is $7,500, adjusted every 3 years.

Question 9

What debt collection practices are illegal in California?

Accepted Answer

Yes. The Rosenthal Fair Debt Collection Practices Act (Civil Code § 1788 et seq.) applies to any person who regularly collects debts in the ordinary course of business, on its own behalf or for others. That means it covers original creditors, not just collection agencies.

Question 10

Do debt collectors need a license in California?

Accepted Answer

Yes. Under the Debt Collection Licensing Act, a license from the DFPI is required to engage in the business of debt collection in California. This includes out-of-state collectors seeking to collect from California residents. Banks and some other licensed lenders are exempt from licensing.

Question 11

What protections apply to medical debt in California?

Accepted Answer

No one may report medical debt to a credit reporting agency, and a medical debt is void and unenforceable if it is knowingly reported. Medical debt contracts signed on or after July 1, 2025 must include a notice of this rule or they are void. Judgments for medical debt under $200,000 bear interest at 5% (not 10%) and can be renewed only once, for 5 years.

Question 12

What is the maximum legal interest rate in California?

Accepted Answer

Interest on an unpaid money judgment is generally 10% a year. For judgments entered or renewed on or after January 1, 2023, the rate is 5% for personal (consumer) debt judgments under $50,000, including credit card debt, and medical debt judgments under $200,000.

Question 13

How do I respond to a debt collection lawsuit in California?

Accepted Answer

File a written response, usually an Answer, with the court within 30 days after the summons is served. If no response is filed, the plaintiff can ask for a default judgment, which can lead to wage garnishment or a bank levy. The California Courts self-help guide has step-by-step instructions by type of debt.

Question 14

How do I stop a garnishment or claim an exemption in California?

Accepted Answer

File a Claim of Exemption, under oath, with the levying officer (usually the sheriff), not the court. The deadline is 15 days after the notice of levy is personally served, or 20 days if it was served by mail. For personal (consumer) debts, a claim may be filed after that deadline, but the levying officer may release the money to the creditor once the 20 days pass.

Question 15

Which bankruptcy exemptions can I use in California?

Accepted Answer

California has opted out of the federal exemptions. In bankruptcy, debtors choose between California's two state exemption systems: the regular exemptions (including the homestead) or the alternative set in CCP § 703.140(b), which includes a $36,750 residence/wildcard amount (effective April 1, 2025).

Time limit to sue on a written contract	4 years for an action on a contract, obligation or liability founded on a written instrument. Once the period has run, a creditor or collector may not sue or start arbitration to collect the debt, and the period can be extended only under the written-acknowledgment rule (CCP § 360). Source: Cal. Code Civ. Proc. § 337(a), (d)
Time limit for credit cards and open accounts	4 years for a book account, an account stated based on a written account, or the balance of a mutual, open and current account with written items. 2 years for a contract not founded on a writing, such as an oral agreement. Source: Cal. Code Civ. Proc. § 337(b); § 339(1)
Can a payment restart the clock?	An acknowledgment or promise to pay extends the period only if it is in writing and signed by the debtor. A payment on a promissory note restarts the period for that note, but a payment by itself does not revive a debt that is already time-barred. Source: Cal. Code Civ. Proc. § 360
How long a judgment lasts	A money judgment can be enforced for 10 years from entry and can generally be renewed for another 10 years by filing an application. For personal (consumer) debt judgments under $50,000 and medical debt judgments under $200,000, the creditor may renew only once, for 5 years (for applications filed after 2022). The one-time 5-year renewal rule was added by SB 1200 (2022), effective January 1, 2023. Source: Cal. Code Civ. Proc. §§ 683.020, 683.110(c), 683.120

Wage garnishment limit	The lesser of 20% of weekly disposable earnings, or 40% of the amount by which weekly disposable earnings exceed 48 times the state minimum hourly wage (or the local minimum wage if higher where the debtor works). This is stricter than the federal limit. Operative September 1, 2023 (SB 1477). Source: Cal. Code Civ. Proc. § 706.050
Money protected in a bank account	$2,325 per debtor in deposit accounts is exempt automatically, without filing a claim (effective July 1, 2026). The amount equals the state's minimum basic standard of adequate care for a family of four (Region 1) and is adjusted every July 1. Higher automatic amounts apply to directly deposited Social Security or public benefits. The automatic exemption does not apply to levies for child or spousal support, wages owed, or state tax collection. Source: Cal. Code Civ. Proc. §§ 704.220, 704.080; Judicial Council form EJ-156 (rev. July 20, 2026)
Homestead exemption	The greater of $300,000 or the countywide median sale price for a single-family home in the prior year, capped at $600,000. Both figures are adjusted every January 1 for inflation (California CPI), beginning in 2022. The current inflation-adjusted floor and cap were not found on an official source. Source: Cal. Code Civ. Proc. § 704.730
Vehicle exemption	$8,625 in combined equity in motor vehicles (and proceeds from their sale or insurance), effective April 1, 2025. The statute's base figure is $7,500, adjusted every 3 years. Statute: https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CCP&sectionNum=704.010. Next 3-year adjustment expected April 1, 2028. Source: Cal. Code Civ. Proc. § 704.010; Judicial Council form EJ-156 (rev. July 20, 2026)
Claiming an exemption	File a Claim of Exemption, under oath, with the levying officer (usually the sheriff), not the court. The deadline is 15 days after the notice of levy is personally served, or 20 days if it was served by mail. For personal (consumer) debts, a claim may be filed after that deadline, but the levying officer may release the money to the creditor once the 20 days pass. Source: Cal. Code Civ. Proc. § 703.520
Bankruptcy exemptions	California has opted out of the federal exemptions. In bankruptcy, debtors choose between California's two state exemption systems: the regular exemptions (including the homestead) or the alternative set in CCP § 703.140(b), which includes a $36,750 residence/wildcard amount (effective April 1, 2025). Dollar amount from https://courts.ca.gov/documents/ej156.pdf Source: Cal. Code Civ. Proc. §§ 703.130, 703.140; Judicial Council form EJ-156 (rev. July 20, 2026)

State debt collection law	Yes. The Rosenthal Fair Debt Collection Practices Act (Civil Code § 1788 et seq.) applies to any person who regularly collects debts in the ordinary course of business, on its own behalf or for others. That means it covers original creditors, not just collection agencies. Source: Cal. Civ. Code § 1788.2(b)-(c)
Debt collector licensing	Yes. Under the Debt Collection Licensing Act, a license from the DFPI is required to engage in the business of debt collection in California. This includes out-of-state collectors seeking to collect from California residents. Banks and some other licensed lenders are exempt from licensing. Source: Cal. Fin. Code § 100001
Medical debt protections	No one may report medical debt to a credit reporting agency, and a medical debt is void and unenforceable if it is knowingly reported. Medical debt contracts signed on or after July 1, 2025 must include a notice of this rule or they are void. Judgments for medical debt under $200,000 bear interest at 5% (not 10%) and can be renewed only once, for 5 years. Source: Cal. Civ. Code § 1785.27; Cal. Code Civ. Proc. §§ 685.010(a)(2), 683.110(c)
Interest rate limits	Interest on an unpaid money judgment is generally 10% a year. For judgments entered or renewed on or after January 1, 2023, the rate is 5% for personal (consumer) debt judgments under $50,000, including credit card debt, and medical debt judgments under $200,000. Source: Cal. Code Civ. Proc. § 685.010(a)

California Debt Collection Laws: Time Limits, Garnishment and Your Rights

Quick answers for California

Time limits

If you are sued

Garnishment and what creditors can't take

Debt collectors and interest

Where to get help in California

Debt & Collections FAQ

More California law