How does a Creditor obtain a Judgment?

A Creditor is a person or entity who is owed money by a Debtor. A Debtor is a person or entity who owes a Creditor money. If a Debtor is behind on payments owed to the Creditor, a Creditor may file a civil action in court to obtain a judgment. Depending on the amount owed, a Creditor would initiate the civil filing in either small claims court, district court, or superior court.

Generally, if a Judge finds that the Debtor owes the Creditor money, a Judgment is entered against the Debtor. After a judgment is entered by the Court, a Creditor can collect on a judgment through judgment execution. North Carolina General Statutes set up a specific judgment execution process that the Creditor must follow.

Judgment Exemptions

Part of the judgment execution process requires the Creditor to mail the Debtor a “Notice of Right to Have Exemptions Designated.” This notice may be served upon you through certified mail or by the Sheriff’s office. This notice provides the Debtor twenty (20) days from the date of service to return and file a “Motion to Claim Exempt Property” or request a hearing to claim exemptions.

What type of Property is Exempt?

Generally, the following property, if claimed within the twenty (20) days, is exempt and cannot be taken by the Creditor or Sheriff:

  1. Real property owned by you and your spouse as Tenants by the Entirety;
  2. Personal property such as household furnishings, household goods, clothes, appliances,books, up to $5,000.00 in value;
  3. Motor Vehicle up to $3,500.00 in value;
  4. Tools of the trade up to $2,000.00 in value;
  5. Life insurance policies, retirement accounts, and college saving plans.

The value of the items listed above may vary depending on the number of claimed dependents. Additionally, depending on your specific circumstances, time restrictions in which goods were bought and sold may apply.


If a Judgment has been entered against you, you have statutory rights to protect your property from being seized and sold. However, it is important to act immediately, as you only have a twenty (20) day window to claim these exemptions. Whether you are a debtor or a creditor, the attorneys at Pinnacle Law can assist you through the judgment execution process and make sure you are receiving all protections in which you are entitled. Contact Pinnacle Law today.