Judgment Debtor and Collections
Congratulations, you won a judgment! Now what? You finally won that judgment against the person who owes you money! So what happens now? The first step is to call the judgment debtor. You are now a judgment creditor, and it's up to you to collect on the judgment. Sadly, the court judgment only means you can collect - it's up to you to make that happen.
What happens after a judgment is made?
The good news is that your hard work is done - you have a money judgment (aka civil judgment). The judicial process worked, and a judge agrees that you are due a certain sum of money. Yes, it's just a piece of paper, but your money judgment does have real value and authority. When judgment is rendered, the judge is awarded judgment credit, and the winner is deemed the judgment debtor. Once the court has issued its ruling, the judicial officer emails a copy to every alleged party in the dispute. This ruling sets out the amount to which judgment debtors owe judgment creditors. In the case of multiple plaintiffs, the decision of the judge lists the total owed to the plaintiffs. This party must split their responsibility for payment. In most cases, a judgment can never become official when it is given. The judge must appeal if he has more than 30 days of legal appeal.
First, some bad news.
But wait, for the bad news - the debtors fail to pay in about 80% of judgment collection cases. Yikes! Still, you are ready to start finding the debtor's assets to forcefully collect on a judgment. But ... you can take some practical steps to ensure you are on the positive side of that statistic. Let's start with a really important point here - the Clerk of Courts is your friend now. You need to know where their office is and understand what the Clerk of Courts can do for you. Go visit the office and let them know you have a judgment. They will give you some information on how to start collecting if your judgment debtor does not pay you. Next, the Clerk can help you if assets exist. Do you know where the judgment debtor has any assets? Bank accounts? Investments? Income from employment? Profits from owning a business? Equity in a home or real estate?
There are lots of ways to collect.
Best Way To Collect on a Judgment
Hire a collection agency $$
Hire an attorney who specializes in collecting a judgment $$
Hire a private investigator $$
Locate assets on your own (not a very good idea)
Hire a professional company like Carl Mason P.I. to do a financial asset search
Receiving the Judgment
In most states, small claims court clerks will send the case decision 1-2 weeks after you have received the ruling. Winners will get a judgment and become judgment creditors. The loser is regarded as a judgment debtor. The judgment should identify the debts that each party owes to the other. In some cases, a person can be held without owing money to others, but a judge can limit its liability. The court is expected to hold defendants jointly and separately liable for their actions, thereby guaranteeing 100% of the damages awarded. Reimbursements must be agreed.
Locating assets of Judgment Debtors
After a judgment is entered, the judgment debtor may be required to provide information about their assets. Then there may be severe sanctions. A judgment creditor should look for financial and investment assets, such as property, real estate, automobiles, art, jewelry, and business interests, if the case is filed. The court can ask the judgment creditor whether the transfer of assets was fraudulent to avoid collection if the transfer was repaid by the judgment debtor.
Collecting Money Judgment
The court can give you a judgment against a debt owed to you, but that doesn't necessarily imply you can pay off the debt. You have to take action to recover the debt from the creditors. Texas law provides several different methods of claiming your unsecured debt. Consult our links below for more detailed information about each option. If you are a judgment debtor, you can find out how you can help with debt collection.
Judgment Enforcement Enables You To Collect On These Assets:
Bank accounts - this is the hardest to find but the easiest to collect using a bank levy.
Brokerage accounts or investment accounts - again, these can be very difficult to find, but the levy process is easy. You can levy investment accounts just like bank accounts.
Real estate - The debtor's property is. You are the judgment creditor, and that gives you the right to find the debtor's assets. You have the backing of the clerk of courts for legal steps like a lien, levy, and garnishment. You can take the judgment to collect on a judgment by finding any and all debtor assets. This can include the debtor's personal property,
Any property belonging to the judgment debtor may have a lien placed on it. This means the real estate cannot be sold until the judgment debtor pays the judgment. In some states, you may be able to seize personal property. Seizing personal property will require an attorney and some legal documents.
How Many Years Can I Keep Collecting A Judgment?
A judgment can be enforced over different periods depending upon the state of action. Some states' enforcement period lasts just 4 years, and dozens of states share the most extended 20-year period. Get advice from the appropriate state court or talk to an attorney about the length of time required for you to collect on a judgment.
Renewing the Judgment
It's not enough for us to hold our judgment for long. It's your time limit to collect. You could extend the term by renewing the judgment before revocation; otherwise, the rights of the collection could become invalid.
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This blog is intended to provide only a brief outline for our site visitors. You should always seek legal advice for your situation. Some of our posts are written by 3rd parties and may not reflect the position of Carl Mason P.I. and also may not be ideal guidance for your case. See our Terms and Conditions if you plan to hire Carl Mason P.I.