Accounts Retrievable Systems – Collecting On A Judgment
If the judge in small claims court rules in your favor, or if a default judgment is issued because the defendant fails to appear or defend the case, the court will issue a judgment for a specific amount of money. This amount will include court costs as well as the amount the court has stipulated you be paid.
If the other party appeals the Court’s decision, he or she is required to put up an Appeal Bond, guaranteeing payment if the appeal is denied. This may help you get your money, but you will have to wait until the appeal is heard.
If the other party does not voluntarily offer to pay you, you must decide how to proceed to get your payment. You have several options:
• You can request the Court to require that the other party make installment payments.
• You can do nothing and wait. The judgment will be entered as a lien against real estate or other real property owned by the other party. The lien must be paid off when the property is sold. If you wait long enough, you will get your money when the property is sold.
• You can contact the other party and discuss payment, including payment terms.
• If the other party does not agree to voluntary payments, or has stopped making payments on an installment agreement, you can file an Affidavit of Default with the Court showing the unpaid balance and requesting action.
• You may ask the Court to garnish the person’s wages or seize property owned (personal bank accounts) to pay off your debt.
In some cases, none of these options works, especially if the party has no assets, no wages, no savings, and no hope of getting the money to pay you. In this case, you maybe should have checked to make sure this person had money before you started the process.
Accounts Retrievable Systems - Collecting The Judgment
After you have provided the enforcement officer with information on the judgment debtor’s assets, he or she can serve a restraining notice on the bank, or on some other person or business that owes money to the judgment debtor, and eventually take the money. If the judgment debtor is employed, the enforcement officer can garnish (take) a portion of his or her salary to satisfy the judgment.
You may also check with the Department of Motor vehicles to find out if the judgment debtor owns a car. Visit the New York State Department of Motor Vehicles website for more information. If the judgment debtor owns a car, the enforcement officer can take the car and sell it to pay your judgment. You must give the enforcement officer the model, year, license plate and location of the car. If the judgment debtor borrowed money to buy the car, that loan must be paid out of the proceeds of the sale before you can get any money. Also, you will have to pay towing and storage fees in advance to the enforcement officer. These fees can typically be $150.00 or more.
You may also be entitled to suspend a judgment debtor’s driver’s license. If your small claims case was based on the judgment debtor’s ownership or operation of car, the Department of Motor Vehicles may suspend the judgment debtor’s driver’s license and registration privileges until the judgment is paid. The amount of the judgment must be more than $1000.00 and must be unpaid for more than 15 days. The clerk can give you more information on this method or you may visit the New York State Department of Motor Vehicles website.
If your small claim relates to the judgment debtor’s business, and the business is licensed or certified by a state or local authority, you can notify that authority if your judgment is not paid within 35 days after the judgment debtor received notice of the judgment. Failure to pay a judgment may be considered by the licensing agency as grounds for revoking, suspending, or refusing to grant or renew a license to operate a business. To find a list of some licensing agencies in new York City go to the Department of Consumer Affairs.
If the judgment debtor is a business that the court finds to be engaged in fraudulent or illegal conduct, you have the right to notify the attorney General, and, if the business is licensed, the appropriate licensing authority as well. Refer to the Attorney General to visit the website.
If the judgment debtor fails to pay three or more recorded judgments despite having sufficient resources to pay them, you may be able to sue the judgment debtor for triple damages. Check with the small claims clerk to find out if the judgment debtor is listed in the index of unsatisfied judgments maintained by the court. To find out where to go in your county, go to Locations.
Accounts Retrievable Systems – Collecting On A Civil Judgment
A civil judgment is the result of a civil court case. When you are owed money for services or a product, you can take a debtor to civil court and receive a civil judgment. At this point, the civil judgment allows you to collect payments, garnish wages, or seek other ways of reimbursement.
Being awarded a civil judgment is not the end of the line, unfortunately. It will take some effort on your part to collect the judgment from a debtor. The most widely used practice is to garnish a person’s wages. In order to garnish wages you will need:
– information on the debtor’s place of employment
– banking information
– information on other assets help by the debtor
At this point, you will then need to pass this information along to a lawyer, the court where the judgment was issued, or to a third party agency.
Sometimes the debtor is willing to negotiate so that you do not have to forcefully take it by garnishing wages. While you may want all your money now, it will be more realistic to arrange a payment plan that is manageable with the judgment debtor. It is better to get several installments of a little money over time rather than none at all. Ask the court to order the debtor to repay the judgment in installments. If the court does not order the installment agreement, ask the debtor to voluntarily enter into such an arrangement.
Tips & Warnings
Most states limit the percentage of a person’s wages that are subject to garnishment.
Some property can be transferred even if a lien has been placed upon it, if the person acquiring the property is willing to assume the property without receiving clear title to the property. This may be the case with a family member.
Accounts Retrievable Systems – Info About Judgment Collection
The person who is awarded a judgment is called the judgment creditor, and the person who owes the amount awarded is called the judgment debtor.
To begin collecting a judgment, you should contact the judgment debtor either directly or through the debtor’s attorney if the debtor was represented by an attorney, and request payment of the judgment amount. If the judgment debtor does not pay, you are entitled to begin collection efforts. These may include one or any combination of the following:
a) garnishment of wages and or bank accounts,
b) lien, seizure and or sale of real property and or personal property, including automobiles,
c) suspension of motor vehicle registration, and or driver’s license, if the underlying claim is based on the judgment debtor’s ownership or operation of a motor vehicle,
d) revocation, suspension, or denial of renewal of any applicable business license or permit,
e) investigation and prosecution by the State Attorney General for fraudulent or illegal business practices, and
f) a penalty equal to three times the amount of the unsatisfied judgment plus attorney’s fees, if there are unpaid claims.
You may read information on these collection methods in the Collecting the Judgment section below.
You may need the services of an enforcement officer. An enforcement officer can use the power allowed to him or her by the law to collect the amount due to you. To learn more about enforcement officers, continue reading below.
Accounts Retrievable Systems – How Judgments Get Collected
Finally, you won your judgment. Now, it’s time to get your money. You asked the debtor to repay you, and they laughed. Now What? Judgment collection by a third-party agency might be your next step.
What to do with your judgment? Your choices are to enforce the judgment yourself, hire a collections lawyer, use a judgment collection agency, or have a judgment enforcer collect your judgment.
Recovering judgments requires too much paper and costs too much. When one owns a judgment, they are responsible for keeping it renewed, monitoring the debtor, and trying to enforce the judgment to get paid.
The owner of a judgment must fill out all paperwork and pay all fees. Enforcing your judgment yourself is appealing because it gives you a chance to recover most of what you are owed.
Enforcing your judgment yourself:
If you have the patience, money, time, and willingness to learn, you can try enforcing your judgment yourself. This works best with stable debtors, when you know where they work. Even then, it’s not as easy or cheap as it should be. One rarely recovers the full amount owed. The court and sites on the Internet will have hints and instructions about recovering your own judgment.
When recovering a judgment, one has to spend money, so one usually does not get to keep the full amount they are owed.
When you ask someone else fill out the forms, pay the fees, and perform the work to recover a judgment, you have to pay them – and give up part of what they recover for you. If you are only spending money and not making progress, giving up part of what is recovered can be appealing.
Using A La Carte enforcement assistance services:
There are companies that allow you to keep ownership of your judgment.
You pay only for the services you need, but do not want to do yourself. These companies offer fixed-fee services including one fee for getting a writ, another fee for doing a sheriff levy, etc. These companies have their own process servers, and let you control everything while they do the work. Be aware that a la carte services charge for their work, not for the results, so you might spend more money without recovering any money.
Accounts Retrievable Systems – Our Collection Agency
Hiring a Lawyer:
If your debtor is rich, investigate using a lawyer. When hiring a lawyer, you retain ownership of your judgment. If your judgment is less than $10,000, it usually makes no sense to hire a lawyer. Even if your judgment is more than $10,000, few lawyers work on contingency unless your debtor is rich. Most of the time you must pay by the hour and also pay all expenses. If your lawyer is not working on contingency, you must pay by the hour even for no results.
Using a Collection Agency:
When using a collection agency, you retain ownership of your judgment. If your debtor is a solid upstanding citizen that will become upset by letters, phone calls, and marks on their credit report, a collection agency might make sense. Unlike a judgment enforcer, a collection agency does not own your judgment, so they are limited in what actions they can take to recover the judgment debt. Most collection agencies typically charge between 20 and 40 percent. If a year goes by with no recovery, perhaps tell the collection agency to stop working on your judgment and try some other ways to get your judgment enforced.
Using a Judgment Enforcer:
When using a Judgment Enforcer (JE), you give up ownership of your judgment. A JE steps into your shoes, in all matters related to recovering money on your judgment. Judgment Enforcers must retain 100% ownership of your judgment while they are trying to enforce it.
One should not worry about giving up ownership to a JE who only gets paid if they recover your money for you. Will the JE give your judgment back if you want it back? If the JE knows the judgment cannot be enforced, most will gladly give you your judgment back. But if the JE is making (or soon will make) progress, most JEs will not give it back. Instead, a Judgment Enforcer pays you your share, as the money comes in from the debtor.
With a Judgment Enforcer (JE) you do not have to spend any money, time, thought, or work to recover money on your judgment. Because JEs only get paid for success, you know they will try to recover your money.
Accounts Retrievable - Small Claims Court Judgment
The Sheriff’s Office can attempt to collect on an outstanding Small Claims Judgment on your behalf if the defendant does not pay within thirty (30) days of the judgment.
If after the thirty day period the defendant does not pay, you may bring or mail your judgment to us and we will attempt to collect the amount of the judgment, plus interest, fees and poundage. The fee for this is $25.00.
In order to have any success in collecting your judgment, you must provide as much information as possible to assist in our attempt to collect. The more information you can provide, the better the chance we will be able to satisfy your judgment.
If you have asked the Sheriff to execute a judgment to seize assets, you must provide as much information about the location of the debtor’s assets as possible, such as:
• Bank accounts (bank names, account numbers, savings/checking);
• Brokerage accounts and securities holdings (companies, account numbers);
• Real estate holdings (addresses);
• Vehicles owned (makes/models, years, license plate numbers); and
• Business holdings (Does debtor own any businesses? Names, addresses).
You may know some of this information or be able to find it on statements, canceled checks, bills, or other papers you have in your records. You can check with the New York State Department of Motor Vehicles to find out if the judgment debtor owns a car that is registered in the state. Most important, you can obtain an “Information Subpoena,” which is a legal document that requires a person (or business entity) to answer questions about their assets. The Small Claims Court Clerk can advise you about this process.
For more information, visit the New York City Small Claims Court website.
Please note: There are additional fees involved if the Sheriff must seize personal property for auction to satisfy the judgment. Some of these costs can be substantial. This will not be done unless costs are paid in advance.
Certain property is exempt from being seized to satisfy a judgment.
Judgments from a Small Claims Court outside of New York City are not valid in New York City unless docketed in a New York State Supreme Court.
What you need to bring/send us:
• Copy of the Judgment
• Completed Request for an Execution
• Completed Creditor’s Advisory
• Check or Money Order for $25.00 made out to “NYC Sheriff”
Accounts Retrievable Systems – Collecting Your Judgements
If you have judgments and want to collect, here’s how to start.
1. Don’t start too soon.
Don’t be in a rush to ask for your money. Most states give a losing party the right to appeal, so it’s usually a good idea to wait until the deadline for filing an appeal (usually 30 days or so) has passed. If you start bugging the other party sooner, you may just nudge him or her into filing an appeal. And generally, the other party doesn’t have to pay a judgment while an appeal is pending.
2. Ask for your money.
A surprising number of debtors will pay their court judgment if you ask nicely. A business-like request for payment is often all it takes, especially if you mention that an unpaid judgment will probably show up on the debtor’s credit report. Don’t tell the debtor exactly how you plan to collect your judgment if he or she doesn’t pay up, however — this may just encourage the debtor to start hiding assets.
3. Suggest ways the debtor can raise cash to pay you.
Once you win a court judgment, you are legally entitled to your money. If the debtor claims he or she wants to pay but doesn’t have the money, suggest some ways to raise cash — for example, by borrowing money from a friend or relative, taking a cash advance on a credit card, or dipping into retirement accounts.
4. Start with easy-to-reach assets.
When you’re planning a collection strategy, it makes sense to start by going after the low-hanging fruit. Wages, bank accounts, and money paid to a debtor’s business are all relatively easy assets to grab — and the procedures for doing so are simple and inexpensive. On the other hand, trying to force a sale of the debtor’s vehicle, house, or personal property can be complicated, expensive, and time consuming.
5. Don’t harass the debtor.
Although you are entitled to go after your money, you should not harass or threaten the debtor. Avoid practices like calling the debtor early in the morning or late at night, repeatedly visiting the debtor at work, or threatening to harm the debtor for failing to pay. Humiliating or intimidating a person who owes you money can be counterproductive, and it could even get you sued.
6. Consider settling for less.
You have the legal right to collect the full judgment you won, but that doesn’t mean that you’ll be able to do it. It can take a long time to collect a judgment, and you might have to spend a lot of energy tracking down the debtor’s assets (or waiting for him or her to acquire some), taking them, and converting them to cash. In many cases, it makes more sense to settle for a bit less than the full claim, in exchange for having the whole thing over and done with.
7. Pay attention to timing.
In many circumstances, you’ll want to move quickly, in order to maintain the element of surprise. For example, a debtor who knows that you plan to go after the money in his or her bank account is likely to close the account and move the cash — before you ever get your hands on it. You’ll also want to make sure to move at the right time — for example, by going after the debtor’s bank account right after he or she deposits a paycheck, not right after he or she pays off a mortgage.
8. Keep tabs on the debtor.
Until you’ve collected your judgment, you will have to keep tabs on the debtor. You’ll want to know if he or she moves, gets a new job, buys an expensive vehicle, or inherits money, for example. Make a point of calling the debtor periodically — and stay in touch with any mutual friends or business contacts who might have valuable information.
9. Consider hiring an expert, if necessary.
There are plenty of collection professionals out there, who will try to collect your judgment in exchange for a percentage of whatever they are able to get from the debtor. If you have had no success in collecting your judgment or you aren’t willing to spend the time and effort necessary to get your money, hiring an expert might be a good idea. After all, it’s better to get some of the money you’re owed than none.
10. Know when to give up.
There are lots of way to collect a judgment — but all of them take time and money. And even though you’re entitled to recover many of the costs of collecting a judgment from the debtor, that won’t do you much good if you can’t even collect the original judgment. Remember the old saying, “Don’t throw good money after bad”? If you’re dealing with a debtor who is unwilling or unable to pay, you might eventually have to decide to cut your losses.
Accounts Retrievable Systems - Collecting A Small Claims Judgment
Winning in small claims court is only half the battle. Nationally, 79 percent of small claims judgment debts are never recovered. Many judgment debtors, the losing party, prove “judgment proof,” meaning they are unable to pay due to extreme lack of assets. While a great number of judgment creditors, the parties who won the judgment, simply give up once collecting from an elusive judgment debtor becomes too time-consuming. However, perseverance and using a variety of legal tactics can increase a judgment creditor’s chances of recovering the court-awarded debt.
1. After the Judge’s Ruling
Try to collect from the judgment debtor immediately after the judgment is given. Approach him while still in the courthouse and obtain a commitment from the judgment debtor.
Allow the allotted time for payment to pass without provoking or asking him to pay voluntarily. Depending on the state, the length of time can vary between two and 30 days.
Check with the court clerk to find out if the judgment debtor has filed an appeal. Depending on the state and court, you can do this online, on the phone or with a letter of request. A losing party may have anywhere from two to 30 days to file an appeal. If an appeal has been filed, you must wait until it’s been decided before using legal procedures to try and collect the debt.
If the time allotted has expired, send a certified letter to the judgment debtor demanding payment for the full amount the court awarded. Ask to receive payment within a limited amount of time. Include the case number and keep a copy for your records.
2. After the Time Has Expired
Request that the court order the judgment debtor to submit a written disclosure of assets and income or a Judgment Debtor’s Statement of Assets if the person refuses to pay. Use the information to determine if the debt owed can feasibly be collected and if so, from which asset.
Uncover the judgment debtor’s assets even if he failed to complete the Statement of Assets by applying for an Order of Examination. This order requires the judgment debtor appear in court for questioning regarding his assets. Ask the court to issue a bench warrant for his arrest if he does not appear.
Compile a list of of financial questions to ask at the judgment debtor examination. Ask questions about his living situation, employment, marital status, bank accounts, credit cards, real property and more. And take notes. This information is a database of property you may eventually have to take through process of the law.
Pay the fee to have the court clerk issue an Abstract of Judgment-Civil to put a lien on the debtor’s property. Take or mail the Abstract of Judgment to the County Recorder’s office in the county where you believe the debtor owns real property. You will not be paid automatically, but if there is a refinancing or sale of the property, you should get paid your money with interest.
Petition the court to issue a Writ of Execution to garnish the debtor’s wages. You’ll then need to prepare an Application for Earnings Withholding Order. Many counties require you to hire a process server to serve the employer with the necessary papers to make sure you will be paid.
Tips & Warnings
Consider a payment plan if the judgment debtor is unable to pay the full amount all at once.
Let the judgment debtor know he can make payments through the court if he does not want to deal with you.
Encourage the debtor to pay you voluntarily. If you are too aggressive in collecting your judgment, the debtor may file for bankruptcy.
Make a copy of the judgment.
You can ask a lawyer or collection agency to help you collect your judgment. But you may have to pay a percentage of the judgment in fees.
Do not threaten physical harm at any time during the process.
Avoid any illegal activity when trying to receive payment.
If the defendant’s correct name is different from what’s written on the judgment, you need to ask the court for a new judgment with the correct name.
Accounts Retrievable Systems – Collecting On A Judgement
A civil judgment is a court order to pay a specified amount of money. Civil judgments must be collected by the person to whom the money is owed, known as a judgment creditor. Judgment creditors may be unpleasantly surprised to know that collection of the judgment is often an arduous and lengthy process, and that it is not rare to be unable to collect the amount at all. Nevertheless, there are some strategies that facilitate the judgment collection process.
Consider hiring an attorney with experience in debt collection and enforcement of judgments in the jurisdiction where your civil judgment was entered. Collecting on a judgment may require court hearings and knowledge of how to levy against a debtor’s property and assets.
Negotiate an installment agreement with the debtor. Ask the court to order the debtor to repay the judgment in installments. If the court does not order the installment agreement, ask the debtor to voluntarily enter into such an arrangement.
When a judgment is entered in the Civil Court of New York State it is enforceable for a period of twenty years for money only, it is not a lien against real property. Nor is a judgment entered in one county a lien on real property in any other county. If a judgment-creditor wishes to enforce a judgment against real property, he or she must follow the procedure below for “transcripting” the judgment. A transcript is a paper containing the essential information of the judgment, certified by the clerk in the county where the judgment is entered.
Place a lien on the debtor’s assets. File a lien with the court against the debtor’s land, buildings, or place of residence, in the county where the assets are located. This lien restricts the debtor’s ability to sell the assets without first using the proceeds of that sale to pay off your judgments.
Before the County Sheriff can seize personal property or assets of the Debtor, the Creditor must first identify the property to be seized. To learn the Debtor’s assets, a Creditor may request an Information Subpoena from the City Court for a fee. An Information Subpoena is a legal document that directs the Debtor to answer certain questions regarding the existence and location of assets as well as employment and wage information. (Although usually served on the Judgment Debtor, an Information Subpoena may be served on another person or corporation, such as a bank, that has knowledge regarding the Debtor’s assets.)
Garnish the debtor’s wages, bank accounts or rent payments due. After providing the name of the employer, the bank account numbers or other relevant information, you can request the court to attach, or garnish, the debtor’s property. Funds from the garnishment can be used to repay the judgment, unless they are subject to an exemption, such as those received from unemployment compensation, Social Security, or worker’s compensation.
Tips & Warnings
-Most states limit the percentage of a person’s wages that are subject to garnishment.
-Some property can be transferred even if a lien has been placed upon it, if the person acquiring the property is willing to assume the property without receiving clear title to the property. This may be the case with a family member.
Accounts Retrievable Collection Agency - Enforcing A Judgment
You need to enforce a judgment you received following a lawsuit. If you sit back and wait patiently, the court will not enforce it for you. Judgments merely grant you the legal ability to use more aggressive debt collection practices, but you have to actively pursue those practices lest the effort you put into suing the debtor become worthless.
Always remember that your judgment enforcement options vary depending upon the laws in the debtor’s state – not the laws in your own state. Be absolutely certain that you are legally entitled to enforce your judgment in a certain way before you attempt it. Not enforcing court judgments legally could leave you the defendant in a lawsuit rather than the plaintiff.
Things You Will Need
Certified copy of the judgment
Writ of garnishment or execution
Step 1
Ask the court clerk to prepare a certified copy of your judgment. The certified copy serves as proof that you sued the defendant and won the lawsuit. Without a certified copy of a judgment, you won’t be able to take advantage of your legal judgment enforcement rights. Preparing the certified copy of the judgment will take several days and sometimes as long as a week, depending on how backed up the court is.
Step 2
Find out where the defendant works and banks, if you haven’t already. You’ll need to provide this information when enforcing your court judgment.
Step 3
Take the certified copy of your court judgment to the county clerk’s office. Do not get the county clerk’s office confused with the court clerk’s office – it isn’t the same location. Provide the county clerk with your certified judgment and the name and location of the defendant’s employer. Ask that the county clerk prepare a writ of garnishment.
Step 4
Contact the sheriff’s office. Request that a representative from the sheriff’s office deliver the writ of garnishment to the debtor’s employer. The debtor’s employer will have no choice but to begin garnishing his wages and submitting those wages to you. Keep in mind that garnishment limitations exist and follow federal law. Therefore, if the debtor earns less than 30 times the federal minimum wage, his employer does not have to withhold his pay.
Step 5
Research the public records in the defendant’s county of residence to determine whether or not he owns or co-owns any property. You can conduct this research either online or at the local courthouse.
Step 6
Take the certified copy of the judgment back up to the county clerk’s office and request a writ of execution if you discover that the debtor does, in fact, own property. You must have the location address of the property that he owns for the clerk to enter on the writ of execution.
Step 7
File the writ of execution in the county’s Land Records office. This creates a real estate lien against the debtor’s home. A real estate lien prevents him from refinancing – and usually from selling – his home until he pays off the judgment that he owes you.
Some states do not allow wage garnishment but do permit checking account garnishment. Very few states have laws restricting a creditor’s access to all forms of judgment enforcement. If a debtor owns no property, holds no job, or lives solely on income that is exempt from seizure, that debtor is judgment proof. Judgment proof debtors are often immune to judgment recovery efforts.
