How Long After a Judgment Can Assets Be Seized?

by George Boykin, Demand Media
    The chances of collecting a judgment decreases with the passing of time.

    The chances of collecting a judgment decreases with the passing of time.

    Creditors usually move rapidly after getting a judgment to collect, because waiting too long gives debtors time to put assets off-limits. When a judgment is not enforced within your state's statute of limitations, creditors are barred from further attempts to enforce the judgment.

    Chances of Enforcing a Judgment

    The judgment collection industry has an unremarkable history of enforcing judgments. According to California Judicial Recovery Specialists, 80 percent of judgments remain uncollected. The average judgment recovery rate for collection agencies is 14 percent, and the value of an uncollected dollar after five years is one penny. Despite these unimpressive statistics, a highly motivated creditor has legal authority to enforce a judgment within the statute of limitations. The standard tools creditors use to enforce judgments are liens against your property, wage garnishment and bank levies. The amount of the judgment is a good barometer of a creditor's motivation. Judgments less than $1,000 normally are too costly to pursue if recovery is not obtained in the early stages of the recovery process.

    Judgment Statute of Limitations

    Creditors have a time limit to collect a judgment. Interest is charged and accrued on the judgment amount within the statute of limitations. The statute of limitations varies by state, and applies to the state where the judgment is obtained. Georgia's judgment statute of limitations is 7 years. The allowable annual interest rate is 12 percent. You should find out the judgment statute of limitations for your state. After the statute of limitations expires, creditors can easily renew a judgment. Consequently, you could find yourself in a position where a judgment could outlive you, depending on the determination of the creditor.

    FTC Anti-Harassment Law

    The Federal Trade Commission enforces the Fair Debt Collection Practices Act, which bars collectors from using abusive, unfair, or deceptive practices to collect from you. The FDCPA applies to consumer debt only. However, the FDCPA does include judgments for consumer debt. It would be wise to visit the FTC website to acquaint yourself with impermissible behavior by debt collectors, and steps you can take to stop debt collector harassment. Stopping the harassment does not make the judgment go away; it merely gives you peace of mind while you develop a permanent debt solution strategy.

    Default Judgments

    Most consumers don't present a defense when sued for delinquent debts, according to an April 1, 2010 article in The New York Times. Creditors win judgments without proof of the debts, or justifying the interest charges and penalties. Basically, consumers automatically lose in court simply by not showing up. If you're on the receiving end of a default judgment, it is possible to vacate (re-open) a default judgment for a variety of reasons. Improper service is the most common reason for a court vacating a judgment. Examples of improper service include leaving the summons with a neighbor or sending the summons to you by mail only. The procedure for petitioning the court to vacate a default judgment is fairly simple, which may make it tempting to engage in do-it-yourself lawyering. It's best, however, to contact an experienced lawyer to navigate the process successfully.

    About the Author

    George Boykin became a professional writer in 2009 after retiring from 35 years in marketing, including several years as chief marketing officer for two consumer products national advertisers and as VP of account management for an AAAA consumer products advertising agency. Boykin mainly writes about advertising and marketing for SMBs.

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