Tennessee Debt Collection Laws: The 25% Cap and the Child Credit Most Debtors Miss

A Tennessee debt collector cannot touch your paycheck on its own signature. It has to sue you, win a judgment, and then send a writ of garnishment to your employer. Most Tennessee garnishments trace back to a default judgment, entered because the person being sued never filed an answer, so responding to the lawsuit is the single highest-value move available once you are served. Once a garnishment does start, Tennessee follows the federal 25% cap almost exactly, with one twist most federal-copy states skip: an extra weekly credit for each dependent child under 16 living with you, stacked directly on top of the cap.

Wage Garnishment in Tennessee: The 25% Cap and the Child Credit

Tennessee's garnishment formula mirrors the federal Consumer Credit Protection Act almost word for word. Tenn. Code Ann. Sec. 26-2-106, quoted directly in Tennessee Attorney General Opinion 19-10, caps garnishment at the lesser of 25% of disposable earnings for the week or the amount by which disposable earnings exceed 30 times the federal minimum hourly wage, roughly $217.50 a week at today's $7.25 federal minimum. Below that floor, nothing can be garnished at all.

Tennessee adds something most states copying the federal formula do not: Sec. 26-2-107 layers an additional $2.50-per-week exemption on top of the cap for each dependent child under 16 who lives in Tennessee. An official Montgomery County circuit court garnishment-answer form spells out the per-pay-period equivalents: $5.00 biweekly, $5.42 semimonthly, $10.83 monthly. The claiming procedure is a condition written into the statute, not a formality. Sec. 26-2-107(b) puts the responsibility on the judgment debtor to inform the employer of each dependent child claimed, and subsection (c) states flatly that the section does not apply if the debtor fails to so inform the employer. Miss that step and the credit is forfeited entirely. The same condition is reproduced in the statutory notice to the garnishee at Sec. 26-2-216(b)(2), which instructs the employer to subtract $2.50 for each qualifying child under 16 residing in the state. If you are being garnished and have children who qualify, tell your employer's payroll office, in writing, and keep a copy.

A garnishment lien in Tennessee does not run forever. It lasts until the judgment is paid in full or until six months after the writ is served, whichever happens first, at which point the creditor has to serve a fresh writ to keep collecting.

When More Than One Creditor Comes After Your Paycheck

Tennessee has a defined answer for what happens when two creditors both want a piece of the same paycheck. Under Sec. 26-2-214(b), the first writ filed gets priority. If a second creditor files a writ seeking less than the statutory maximum, that second writ can only collect the gap between what the first writ is already taking and the overall cap, and it adjusts upward automatically, no new filing required, once the first writ is satisfied or expires. But if the second writ itself demands the full maximum allowed, Sec. 26-2-224(a) says it does not run at the same time as the first writ at all; it simply waits until the earlier judgment is paid, expires, or is paused by an installment order.

Child support sits above all of this. Sec. 36-5-501(j)(1) gives a child support income assignment priority over any other Title 26, Chapter 2 garnishment. And no matter how many writs are stacked, the combined amount taken can never exceed the federal ceiling under 15 U.S.C. 1673.

The Installment Stay: A Way to Pause Garnishment

Tennessee lets a garnished debtor propose a payment plan instead. Under Sec. 26-2-216, you can move the court for an order suspending further garnishment by the same creditor in exchange for paying a set sum weekly, biweekly, or monthly toward the judgment. Filing the motion stops the garnishment for as long as you keep making the ordered payments. This is a real, court-supervised alternative to having 25% of a paycheck disappear every pay period, and it is worth raising with the court or an attorney before assuming garnishment is the only option once a judgment is entered.

How Long Can You Be Sued Over a Tennessee Debt

Tenn. Code Ann. Sec. 28-3-109(a) provides that «the following actions shall be commenced within six (6) years after the cause of action accrued», and subdivision (a)(3) is the catch-all that captures ordinary consumer debt, including credit card debt: «actions on contracts not otherwise expressly provided for». The wording matters, because it is often loosely described as a rule for written contracts. It is not limited to written contracts, which is why Tennessee's six-year period reaches oral agreements as well. The main carve-out is a contract for the sale of goods, which runs four years under Sec. 47-2-725(1).

Tennessee's revival rule cuts hard against debtors, and it is settled by the state's highest court rather than by statute. In Graves v. Sawyer, 588 S.W.2d 542 (Tenn. 1979), the Tennessee Supreme Court overruled its earlier contrary decisions and held that, in the absence of evidence to the contrary, a voluntary and unconditional payment on a debt or of interest on a debt «is an acknowledgment of the debt and implies a promise of payment which operates to keep the debt alive for the statutory period from that time». In practical terms, paying even a small amount on an old Tennessee debt can restart the six-year clock from the date of that payment. That is the most expensive mistake available to someone being contacted about a debt that may already be too old to sue on, so pin down how long ago the account actually went into default before you send a collector any money.

Whatever the exact number turns out to be, a time-barred debt is not an erased debt. A collector can still ask you to pay it. What federal Regulation F forbids is suing or threatening to sue on debt that is genuinely past the deadline.

Car Repossession in Tennessee

Tennessee enacted the standard UCC self-help rule at Tenn. Code Ann. Sec. 47-9-609: after default, a secured lender may repossess a vehicle without going to court, including rendering equipment unusable and disposing of it on your property, as long as it does not breach the peace. Neither the statute nor this research turned up a Tennessee right-to-cure requirement giving you advance notice or a set window to catch up before repossession.

No notice is owed before the tow, but notice is owed before the resale, and that is where a Tennessee consumer gets the most usable leverage in the whole chapter. Sec. 47-9-611(b) requires the secured party to send the debtor a reasonable authenticated notification of disposition before it sells the collateral, and Sec. 47-9-612(b) makes a notice sent after default and ten days or more before the earliest sale date reasonable as a matter of law. In a consumer-goods transaction such as a car loan, Sec. 47-9-614 prescribes what that notice must contain, including a description of any deficiency liability and a telephone number you can call to get the exact amount required to redeem the vehicle. Sec. 47-9-623 is the right that phone number exists to serve: you, or anyone else obligated on the loan, may redeem the car at any time before the lender disposes of it, contracts to dispose of it, or accepts it in satisfaction of the debt, by tendering the full obligation plus the lender's reasonable expenses and attorney's fees. Redemption means the entire balance, not merely the missed payments.

What Tennessee case law does develop is what comes after the tow truck leaves. In WM Capital Partners v. Thornton (Tennessee Court of Appeals, 2016), the court held that a lender's duty under Sec. 47-9-610(b) to run a commercially reasonable disposition, meaning every aspect of the sale, from method to timing to price, only attaches once the lender has actual or constructive possession of the vehicle; simply refusing to repossess when a debtor asks does not, by itself, create that possession. Sec. 47-9-615(d) makes clear you remain liable for any deficiency after a proper sale, but Sec. 47-9-626(4) gives you a real lever: if the lender's compliance with the commercially-reasonable-sale rules is challenged and the lender cannot prove it, the law presumes the sale would have covered the full debt, which can wipe out a deficiency claim entirely.

If You Are Being Garnished or Sued in Tennessee

If you have been served with a debt lawsuit in Tennessee, answer it. A default judgment opens every collection tool at once and forfeits defenses, including an expired statute of limitations, that a court will not raise for you. If a garnishment has already started, check whether you have dependent children under 16 who qualify for the additional weekly credit and make sure your employer has been told about each of them, since Sec. 26-2-107(c) forfeits the credit if the employer is not informed, and whether an installment-payment motion under Sec. 26-2-216 could stop the garnishment while you pay on your own terms. If a child support order is competing with an ordinary garnishment, remember it takes priority under Tennessee law and is handled as a separate legal track, not an ordinary consumer collection matter. And if garnishments and judgments are piling up faster than any single fix can address, bankruptcy's automatic stay halts collection activity while the bigger picture gets sorted out; whether that is the right move depends on your full financial situation.

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

Related Resources

For the national picture, see debt collection laws by state, statute of limitations on debt, how to stop wage garnishment, and car repossession laws. Social Security and other federal benefits have their own protection rules, covered in can Social Security be garnished. For deadlines on other Tennessee claim types, see the Tennessee statute of limitations. Child support garnishment runs through a different, higher-priority process, covered in Tennessee child support laws. If the debts themselves have become unmanageable, Tennessee bankruptcy explains the state's exemptions.

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Last updated: 2026-08-12.

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