Sued for Debt in Alabama? Here's What to Do Next

You have 30 days from service to file your Answer with the court. Missing this deadline results in a default judgment.

6 years from the date of the last payment or charge.

Yes. Up to 25% of disposable earnings can be garnished after a judgment is obtained.

District court handles cases up to $20,000. Circuit court handles larger amounts. Small claims court handles cases up to $6,000.

If you don't file a written Answer within 30 days of being served, the collector can ask the court for a default judgment under Ala. R. Civ. P. 55. That judgment lets them garnish up to 25% of your disposable wages (Ala. Code § 6-10-7), levy your bank accounts, and place liens on non-homestead property. Default judgments in Alabama are good for 10 years and can be renewed. The better path is to file an Answer that denies the allegations and asserts defenses like statute of limitations under Ala. Code § 6-2-34, lack of standing, and failure to validate the debt under 15 U.S.C. § 1692g. Even a short Answer stops the default and forces the collector to actually prove they own your debt, that the amount is correct, and that the chain of assignment is documented. Many debt-buyer cases collapse at that stage because the plaintiff cannot produce the original signed agreement or a complete account history.

Federal law controls where the suit can be filed. Under 15 U.S.C. § 1692i, the collector must sue in the judicial district where you signed the original contract or where you currently live. If you signed a credit card application in Georgia but now live in Mobile, the collector must sue you in Mobile County, not Georgia. Suing in the wrong venue is a per se FDCPA violation that can give you a counterclaim worth up to $1,000 in statutory damages plus actual damages and attorney's fees under 15 U.S.C. § 1692k. The substantive law that applies to the debt may still be the state of contracting (often listed in a choice-of-law clause), but Alabama's six-year SOL under Ala. Code § 6-2-34 applies to the suit itself as the forum state. If the collector picked a wrong venue, raise it immediately in your Answer or by motion to dismiss or transfer.

Alabama's six-year statute of limitations on written contracts and open accounts (Ala. Code § 6-2-34) starts to run from the date of default, typically the date of the last payment. Once the six years run, the debt is time-barred and a collector who sues anyway is asserting a claim they cannot legally enforce, which violates 15 U.S.C. § 1692e(2) and § 1692f(1) of the FDCPA and CFPB Regulation F (12 CFR § 1006.26). Be careful: Alabama allows revival of a time-barred debt by a new written promise to pay under Ala. Code § 6-2-13, but a partial payment alone generally does not restart the clock for a fully time-barred debt. If a collector sues you on an old debt, raise the statute of limitations as an affirmative defense in your Answer and consider filing an FDCPA counterclaim.

Alabama has fairly limited exemptions compared to many states. Under Ala. Code § 6-10-6, you can claim up to $1,000 in personal property as exempt from execution; the state homestead exemption is $5,000 (or $10,000 for a married couple) on up to 160 acres under Ala. Code § 6-10-2. Wages enjoy the federal floor: under 15 U.S.C. § 1673 and Ala. Code § 6-10-7, only the lesser of 25% of disposable earnings or the amount above 30 times the federal minimum wage can be garnished. Social Security, SSI, VA benefits, and most public assistance are federally protected from garnishment under 42 U.S.C. § 407. To assert exemptions after a judgment, file a claim of exemption with the court. Don't wait for the collector to honor exemptions on their own; bank levies often require an affirmative motion to release exempt funds.

Yes, and it is one of the most useful tools you have. Under 15 U.S.C. § 1692g, any third-party debt collector must send you a written validation notice within five days of first contact, telling you the amount, the current creditor, and that you have 30 days to dispute the debt in writing. If you dispute within that 30-day window, the collector must stop collection activity until they mail you verification, including documents showing the original creditor, the amount owed, and proof of assignment if the debt was sold. CFPB Regulation F (12 CFR § 1006.34) requires the validation notice to include itemization, statement dates, and a tear-off dispute form. Even if 30 days have passed, you can still dispute under § 1692g(b) at any time, and a written dispute creates leverage when the collector tries to collect or sue. Send disputes by certified mail with return receipt and keep a copy.