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

30 days from service to file your Answer with the circuit court.

5 years for written contracts and credit cards. 5 years for oral contracts.

Yes, but the first $200 per week is exempt if you are head of household.

Yes. The Arkansas Deceptive Trade Practices Act provides additional protections against unfair collection practices.

Arkansas applies a five-year statute of limitations to actions on written contracts under Ark. Code Ann. § 16-56-111, which courts have applied to credit card accounts. The clock typically starts on the date of default, usually the date of last payment. Once five years pass without a lawsuit, the debt is time-barred. A collector who sues on a time-barred debt commits a violation of 15 U.S.C. § 1692e(2) (misrepresenting the legal status of the debt) and § 1692f(1) (attempting to collect an amount not legally owed). You should raise the statute of limitations as an affirmative defense in your Answer and consider filing an FDCPA counterclaim for up to $1,000 in statutory damages plus actual damages and attorney's fees under 15 U.S.C. § 1692k. Avoid making any partial payment or written acknowledgment of an old debt, which can revive the SOL under Ark. Code Ann. § 16-56-115.

Arkansas provides one of the strongest wage protections in the country. Under Ark. Code Ann. § 16-66-208, the first $200 of weekly net earnings is fully exempt for any resident who is the head of a family. That is on top of the federal 25% cap under 15 U.S.C. § 1673. Practically, that means a collector with a judgment can garnish only the smaller of 25% of disposable earnings or amounts above $200 per week. If you do not assert head of household status, the collector and court may apply only the federal floor, so you must file a written claim of exemption with the issuing court promptly after receiving notice of garnishment. The exemption also applies to bank accounts holding traceable wages. Federal benefits like Social Security, SSI, and VA deposits remain fully protected under 42 U.S.C. § 407, regardless of head-of-household status.

Arkansas has one of the most generous homestead exemptions in the country. Under Arkansas Constitution Article 9, sections 3-5, the homestead of a head of family is exempt from sale under execution to satisfy most debts. The exemption covers up to 1/4 acre in a city, town, or village (regardless of value) and up to 80 acres outside a city, plus an additional 80 acres if the property's value is below specified caps. That means a credit card or medical debt judgment generally cannot force the sale of your primary residence if you are the head of a family. The exemption does not apply to purchase-money mortgages, taxes, or mechanic's liens. The collector can still record a judgment lien on non-homestead property, which is good for 10 years and can be renewed. To assert the homestead exemption, file a claim with the circuit court promptly.

Arkansas debt collection cases are filed in circuit court, often in the small claims division for amounts up to $5,000. Larger cases go to the general civil division of the circuit court. Under Ark. R. Civ. P. 12(a), you have 30 days from service to file a written Answer with the court. Small claims procedure under Ark. Code Ann. §§ 16-17-602 et seq. is simplified, but lawyers are still allowed for plaintiffs. Venue is governed by Ark. Code Ann. § 16-60-101 and the federal FDCPA at 15 U.S.C. § 1692i: the suit must be in the county where you live or where you signed the original contract. If a collector files in the wrong county, raise improper venue in your Answer and as an FDCPA counterclaim, which exposes the collector to statutory damages under 15 U.S.C. § 1692k.

The Arkansas Deceptive Trade Practices Act (Ark. Code Ann. §§ 4-88-101 et seq.) prohibits any deceptive or unconscionable trade practice, and Arkansas courts have applied it to debt collection conduct including false statements about debt status, harassment, and improper collection from time-barred debts. Under Ark. Code Ann. § 4-88-113(f), private plaintiffs can recover actual damages, attorney's fees, and in cases of willful or knowing violations, additional damages. The ADTPA's reach extends to both third-party collectors and original creditors operating in trade or commerce, filling a gap the federal FDCPA leaves open. Many of the same facts that support a federal FDCPA counterclaim under 15 U.S.C. § 1692e (false representations), § 1692f (unfair practices), or § 1692g (validation violations) also support a parallel ADTPA claim with potentially broader damages.