Oregon Debt Collection Laws: SB 1595 Garnishment Floors, the 6-Year SOL, and Repossession

An Oregon creditor cannot touch your paycheck without first suing you, winning a judgment, and serving a writ of garnishment. That sequence matters because most Oregon collection judgments are default judgments entered when nobody answers the complaint, which makes answering the summons the single most valuable step a debtor can take. Once a garnishment does issue, Oregon is now one of the more protective states in the country: the 2024 reform known as SB 1595 layered rising flat-dollar floors on top of the old 75 percent rule, added a no-questions-asked cushion for bank accounts, and set the wage floors to climb again every July 1.

How Much of a Paycheck Can Be Garnished in Oregon

Oregon's wage exemption, ORS 18.385, works in two layers. First, 75 percent of disposable earnings (pay left after legally required deductions) is always exempt, so a creditor can reach at most 25 percent. Second, a garnishment may never reduce your take-home pay below a flat minimum. Under SB 1595 (2024), those floors are on a legislated escalator for ordinary debts:

• Wages payable July 1, 2025 through June 30, 2026 (the current period): $338 per week, $675 per two-week period, $737 per half-month, $1,458 per month.
• From July 1, 2026: $400 per week, with the biweekly and monthly companions scaled accordingly.
• From July 1, 2027: the State Court Administrator publishes an annually adjusted figure each year.

If your weekly disposable pay is at or below the floor, nothing is garnishable; above it, the creditor gets the lesser of 25 percent or the amount above the floor. Because the floor moves every July 1, always check the current figure on the Oregon Judicial Department or Department of Revenue site before relying on a number. Garnishments for criminal restitution use the older, frozen $254 weekly floor, and support withholding runs under the separate federal ceilings of 50 to 65 percent of disposable pay.

One further protection is built into the same statute: an employer may not discharge an individual because their earnings have been garnished, and unlike the federal rule that protection is not limited to a single debt. Note the citation carefully. SB 1595 renumbered that rule from ORS 18.385(9) to ORS 18.385(11), so guides still citing 18.385(9) are pointing at a different provision (subsection (9) now bars a court from making or enforcing an order in violation of the section).

State tax debt is collected on harsher terms, not equal ones. ORS 18.385(8) provides that the subsections carrying the flat-dollar floors do not apply to a debt due for state tax. On a Department of Revenue wage garnishment, only the 75 percent rule stands between you and the collector; the $338, $675, $737 and $1,458 floors above simply do not apply. That is exactly why ORS 18.855(2) directs state agencies to modify the standard wage exemption calculation form when the debt is a state tax subject to ORS 18.385(8): the ordinary computation no longer fits. Worse, if the agency has reason to believe you intend to leave the state or take some other step that would jeopardize collection, it may issue a special notice of garnishment under ORS 18.855(6), and earnings garnished under that notice are «not subject to a claim of exemption under ORS 18.385» at all. Federal debts are the exception in every state: defaulted federal student loans garnish 15 percent of disposable pay administratively, and IRS levies follow federal tables.

When multiple writs hit the same paycheck, the first writ delivered has priority (ORS 18.627), and support withholding outranks ordinary garnishments entirely (ORS 25.375).

Bank Accounts: Two Layers of Protection

SB 1595 gave Oregon one of the cleaner bank-account regimes:

• A flat cushion, $2,500 at enactment and adjusted for inflation since (currently about $2,600), is protected in your accounts regardless of the source of the funds. This «base protected account balance», annually indexed to CPI-W West Region each July 1, is codified at ORS 18.785 as amended by SB 1595 Section 10, a separate provision from the traceable-funds rule below. It does not apply against support or restitution debts.
• Traceable exempt funds stay exempt. Under ORS 18.348, funds that were exempt before deposit (wages within the 75 percent exemption, retirement funds, public benefits) remain exempt after deposit while reasonably identifiable, up to $7,500. Funds exempt under federal law, such as Social Security, remain exempt without that cap, and directly deposited federal benefits also carry the automatic two-month federal shield under 31 CFR Part 212; see Can Social Security be garnished?.
• When a bank receives a garnishment, it must immediately calculate the protected amount, keep it available to you, and send you a notice within three business days (ORS 18.785).

One caution for anyone reading older material: ORS 18.784 was repealed in 2024 by the same reform (SB 1595 Section 31), which folded its garnishment-account-review machinery into the amended ORS 18.785. Guides still citing 18.784 are out of date.

The Statute of Limitations on Debt in Oregon

Oregon keeps it simple: contract actions, express or implied, written or oral, carry a 6-year limitations period under ORS 12.080. That covers credit cards, medical bills, personal loans, and store accounts. For an open account, the clock runs from the last charge or payment, and interest or finance charges do not count as a charge that restarts it (ORS 12.090). Promissory notes payable at a definite time also run 6 years (ORS 73.0118), and contracts for the sale of goods run 4 years (ORS 72.7250).

Revival is real in Oregon. A payment of principal or interest on an existing debt restarts the limitations period from the date of that payment (ORS 12.240). An acknowledgment or new promise restarts it only if contained in a signed writing (ORS 12.230). The practical warning: a small payment on an old Oregon debt hands the collector six more years to sue, so get advice before paying anything on aged debt.

The federal overlay applies here as everywhere: a collector who sues or threatens suit on time-barred debt violates Regulation F (12 CFR 1006.26), collection contact on old debt remains legal, and the seven-year credit reporting clock runs on its own schedule. Oregon adds a state-law hook that is often the more useful one for an Oregon reader: under ORS 646.639(2)(r), a debt collector commits an unlawful collection practice by filing, or attempting to file, a legal action to collect a debt when the collector «knows, or after exercising reasonable diligence would know, that an applicable statute of limitations bars the collection or the collection attempt», and ORS 646.639(4)(a) imposes the same bar on debt buyers. The state-by-state table is in our statute of limitations on debt guide, and Oregon's broader civil deadlines are covered in Oregon's statute of limitations.

Car Repossession in Oregon

Oregon enacted the standard UCC rule: after default, a secured lender may repossess without a court order if it can do so without a breach of the peace, and the sale must be commercially reasonable, with the borrower liable for any deficiency. A citation note for anyone checking the statutes: Oregon renumbered its secured-transactions chapter in 2025, so the self-help section formerly cited as ORS 79.0609 is now ORS 79A.6090 (and 79.0610 and 79.0615 became 79A.6100 and 79A.6150).

Oregon's consumer overlay for vehicle financing is contract-focused: under ORS 83.670, any clause in a motor vehicle retail installment contract that purports to authorize unlawful entry onto the buyer's premises or a breach of the peace during repossession is unenforceable, as is any clause waiving the buyer's right to sue over illegal collection or repossession conduct. We did not locate a general Oregon statutory right to cure a default before a vehicle repossession, so do not assume a cure window exists; a borrower's leverage is the breach-of-peace limit, the commercially-reasonable-sale requirement, and redemption before sale. Title lenders operate under a separate licensing law (ORS chapter 725A) with a 36 percent rate cap and renewal limits. The national baseline, including the court-order rule for servicemembers' pre-service loans, is in car repossession laws.

Oregon's Unlawful Collection Practices Statute

Oregon does not leave collector conduct to the federal FDCPA alone. ORS 646.639 defines a long list of unlawful collection practices binding on any debt collector working an Oregon consumer debt. Among them: threatening arrest or criminal prosecution; threatening to seize, attach or sell your property without disclosing that a court order is required first; communicating or threatening to communicate with your employer about the nature or existence of the debt; contacting you at your workplace after you have told the collector not to; attempting to enforce a right or remedy the collector knows does not exist; adding fees or charges that cannot legally be added to the debt; and collecting a debt the collector knows, or with reasonable care should know, is not owed by you.

Two provisions matter most when a debt buyer is the plaintiff. ORS 646.639(2)(r) and (4)(a) make it unlawful to file or attempt a collection action on a debt the collector knows, or with reasonable diligence would know, is barred by the statute of limitations. And ORS 646.639(4)(b) requires a debt buyer bringing suit to hold business records establishing the nature and amount of the debt, including the original creditor's name as used in dealings with you, the last four digits of the original account number, an itemized statement of the amount claimed, evidence that the debt buyer and only the debt buyer owns the debt, the date it bought the debt, and a copy of the signed contract or, for credit card debt, the most recent statement showing a purchase, a balance transfer, or your last payment. On request, a debt buyer must provide those documents within 30 days, and it may not keep collecting until it does (ORS 646.639(2)(t) and (4)(d)). That is the concrete reason an answer to the complaint has teeth.

Registration is a separate check worth running early. Under ORS 697.015, no one may operate as a collection agency in Oregon without registering with the Department of Consumer and Business Services under ORS 697.031, and that section requires most registrants to file a $10,000 bond or irrevocable letter of credit that a consumer who wins a judgment against the agency can pursue if the judgment goes unpaid.

If You Are Being Garnished or Sued in Oregon

Answer the complaint, even on a debt you recognize, because an answer forces the plaintiff to prove ownership and the amount, and preserves the six-year limitations defense, which is waived if never raised. If a garnishment is running, check the math against the current floor ($338 a week through June 2026, $400 after July 1, 2026) and use the challenge procedure: Oregon gives debtors a short window to file a challenge to a garnishment with the court, and grounds include exempt income and exempt bank funds. If judgments are stacking faster than the exemptions can shield, the bankruptcy automatic stay stops garnishment while the case is open; see Oregon bankruptcy law. This is a description of process, not a promised outcome.

Information last verified on 2026-09-02. This article has not yet been reviewed by a licensed lawyer.

Related Resources

• Debt Collection Laws by State
• Statute of Limitations on Debt
• How to Stop Wage Garnishment
• Car Repossession Laws
• Oregon Statute of Limitations
• Oregon Bankruptcy
• Oregon Child Support Laws

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Last updated: 2026-09-02.

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