Delaware Debt Collection Laws: Wage Garnishment, Statute of Limitations, and Repossession

A collector cannot start taking money from your paycheck in Delaware just because you fell behind. The creditor first has to sue you, win a judgment, and get a court attachment against your wages before your employer withholds anything. That sequence is where most garnishments are actually decided, because the large majority happen through a default judgment entered when the person being sued never responded. If you take one action from this page, answer any lawsuit you are served with, even if you believe the debt is too old or is not yours.

Wage Garnishment in Delaware

Delaware runs one of the simplest wage-exemption formulas of any state. Under 10 Del. C. 4913(a), 85% of a wage earner's wages is exempt from attachment and execution, meaning only 15% can be taken toward an ordinary judgment debt. There is no separate minimum-wage-multiple test layered into the state statute itself, though the federal $217.50-per-week floor under the Consumer Credit Protection Act still applies of its own force wherever it would protect more than Delaware's flat percentage does.

The 85% exemption is not absolute. It does not apply to process issued to collect a fine, court costs, or taxes owed to the State of Delaware, so a state tax or court-debt attachment can reach further than an ordinary consumer-judgment attachment can.

Only one attachment can run against a given amount of wages due at a time. If a second creditor also has a judgment, it has to wait its turn behind the first attachment until that debt is satisfied in full. Delaware has no head-of-household wage exemption on top of the 85% rule, and we did not locate a Delaware statute extending firing protection beyond the federal rule that bars discharge over a garnishment for any one debt.

Medical debt runs the other way entirely. A hospital or a collector working a medical bill cannot garnish any share of your wages, not even the 15%. That rule is covered in its own section below.

Bank Account Protections

This is the point where Delaware residents most often get misled. A frequently cited figure, the $25,000 exemption in 10 Del. C. 4914, applies only «in any federal bankruptcy or state insolvency proceeding.» It is a bankruptcy exemption, not a shield against an ordinary bank garnishment outside of bankruptcy, and it should never be relied on as protection against a creditor's collection attachment on a bank account.

We did not find a Delaware statute creating an automatic exemption for money sitting in a bank account outside of bankruptcy. If a Delaware bank account is garnished for an ordinary judgment debt, plan to raise any exemption claim directly with the court rather than assuming a specific dollar figure is automatically protected.

Delaware does have two general exemption statutes that operate outside bankruptcy, but neither one shields a deposit account. 10 Del. C. 4902 exempts named articles from execution, attachment, and distress for rent: the family Bible, school books and family library, family pictures, a church seat or pew, a burial lot, wearing apparel, and the tools and fixtures needed to carry on a trade or business, capped at $75 in New Castle and Sussex Counties and $50 in Kent County. 10 Del. C. 4903 lets a person who is the head of a family exempt an additional $500 of personal property, with «the articles to be selected by the debtor.» Both are claim-it-yourself exemptions over articles, not an automatic dollar shield on money in an account, which is why the practical advice above is to raise the claim with the court.

Medical debt is the significant exception to this whole section. Bank accounts, pensions, annuities, and retirement accounts are off limits to a medical creditor or medical debt collector outright, not merely exempt up to some amount.

Federal benefits carry a separate, well-established shield regardless of state law. Social Security, VA, and similar federal benefits that arrive by direct deposit are automatically protected for the trailing two months of deposits under 31 CFR Part 212, and the bank applies that protection without you filing anything. Benefits paid by paper check and later deposited do not get this automatic treatment and must be claimed as exempt through the court.

Medical Debt Is Treated Differently

Delaware's Medical Debt Protection Act, 6 Del. C. ch. 25J, takes both of the collection tools described above off the table for medical bills. Under 6 Del. C. 2505J(a), a medical creditor or medical debt collector may not garnish the wages, disability insurance payments or other disability benefits, workers' compensation payments, or unemployment benefits of a patient, and may not garnish or attach a patient's bank account, pension, annuity, or retirement account. The same subsection bars causing the patient's arrest, subjecting the patient to a writ of body attachment or capias, and foreclosing on the patient's real property.

Who counts as covered matters here. «Medical creditor» is defined at 6 Del. C. 2502J(10) as a large health-care facility, which the chapter limits to a licensed hospital, an outpatient clinic operating under a hospital's license or majority hospital ownership, or a licensed freestanding emergency department. «Medical debt collector» is broader: any person who regularly collects medical debts originally owed to someone else, and a medical debt buyer counts as one. So a hospital collecting its own bill, and any collection agency or debt buyer working a medical account, are both covered. A small independent practice pursuing its own bill directly fits neither definition.

Two timing rules sit on top of the outright bans. No permissible extraordinary collection action may begin until 120 days after the first bill for the medical debt was sent, 6 Del. C. 2505J(c). And at least 30 days before taking any extraordinary collection action, the medical creditor or medical debt collector must give the patient written notice that identifies the actions it intends to initiate, states whether financial assistance is available along with a plain-language summary of that policy, and sets a deadline no earlier than 30 days after the date of the notice, 6 Del. C. 2505J(d).

«Extraordinary collection action» is itself defined, at 6 Del. C. 2502J(4), and it reaches further than garnishment. It covers reporting adverse information to a consumer reporting agency, selling the debt to another party outside a tightly conditioned written agreement, placing a lien on property, attaching or seizing a bank account or other personal property, and filing a civil action.

If a hospital or a collector chasing a medical bill has garnished your wages or attached your account, that is the statute to raise with the court.

Statute of Limitations on Debt in Delaware

Delaware keeps its debt statute of limitations unusually uniform. Under 10 Del. C. 8106(a), an action on a debt not evidenced by a record or instrument under seal, including promises and mutual debit-and-credit accounts, must be brought within 3 years. That single period covers written contracts, oral contracts, open accounts, and credit-card debt alike; Delaware does not single out cards for different treatment.

Delaware allows parties to a written contract of $100,000 or more to agree, in the contract itself, to a limitations period as long as 20 years, a carve-out that mainly affects commercial lending rather than ordinary consumer debt.

We did not locate a Delaware statute addressing whether a partial payment or written acknowledgment revives an already-expired debt. Delaware's revival practice, if any, appears to rest on common law rather than a codified rule, so treat any specific claim about payment restarting Delaware's clock as unconfirmed rather than settled.

Time-barred does not mean the debt disappears. A collector may still contact you about an old debt, but federal Regulation F, 12 CFR 1006.26, bars a debt collector from suing or threatening to sue on a debt once the statute of limitations has expired. Credit reporting runs on its own separate clock, roughly seven years, regardless of the limitations period.

What Debt Collectors Can and Cannot Do

The federal Fair Debt Collection Practices Act governs third-party collectors operating in Delaware. They cannot use false, deceptive, or misleading statements, including misrepresenting the amount or legal status of a debt, and cannot threaten action they cannot legally take or do not intend to take, 15 U.S.C. 1692e. Regulation F adds specific limits on call frequency and requires collectors to provide validation information. Complaints can be filed with the CFPB and the Delaware Attorney General's Fraud and Consumer Protection Division.

Car Repossession Rules

Delaware enacted the Uniform Commercial Code's self-help repossession rule at 6 Del. C. 9-609: after default, a secured party may take possession of collateral without judicial process, as long as it can do so without a breach of the peace, a standard the statute leaves undefined and that courts interpret case by case.

We found no Delaware statute giving consumers a right-to-cure notice or a fixed waiting period before a vehicle can be repossessed, comparable to the cure regimes some other states impose. That means a Delaware lender generally does not have to warn a borrower before taking a vehicle for a payment default, beyond whatever notice its own contract requires. After repossession, the sale of the vehicle must still be commercially reasonable, the proceeds are applied to the debt, and a borrower can be sued for any remaining deficiency.

Servicemembers get an additional federal layer. For an installment contract entered into before military service, the Servicemembers Civil Relief Act, 50 U.S.C. 3952, requires a court order before the property can be repossessed for a pre-service breach.

If You Are Being Garnished or Sued in Delaware

Work the problem in this order:

1. Answer the lawsuit. A default judgment is how most Delaware garnishments start. Filing an answer, even a simple one disputing the amount, forces the creditor to prove its case and often opens the door to a payment arrangement.
2. Check the garnishment math. Delaware's rule is simple: no more than 15% of wages can be taken for an ordinary judgment. If more is being withheld, or the debt is a state fine, cost, or tax, ask what exception applies. If the underlying debt is a medical bill, no wage garnishment is allowed at all.
3. Do not rely on the $25,000 bankruptcy figure outside of bankruptcy. That exemption in 10 Del. C. 4914 only helps inside a federal bankruptcy or state insolvency case, not against an everyday bank garnishment.
4. Ask whether the debt is time-barred. Delaware's 3-year period applies broadly to written, oral, and open-account debt alike. Raise the statute of limitations as a defense in your answer; the court will not raise it for you.
5. Consider bankruptcy if the debt is unmanageable. Filing triggers an automatic stay that stops garnishment immediately, and Delaware's exemptions, including the $25,000 figure, apply fully inside bankruptcy.

Information last verified on 2026-08-12. This article has not yet been reviewed by a licensed lawyer.

Related Resources

• Debt Collection Laws by State
• How to Stop Wage Garnishment
• Statute of Limitations on Debt
• Can Social Security Be Garnished?
• Delaware Statute of Limitations
• Delaware Bankruptcy Laws

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Last updated: 2026-08-12.

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