What Can a Creditor Do Legally After a Civil Judgment Is Granted?
The law of the state where a civil judgment is issued or enforced dictates what a creditor can legally do to collect a court judgment. Once a judgment is granted, the judgment creditor typically has a longer time frame to attempt collection and more legal options for satisfaction.
Other People Are Reading
-
Garnishment
-
Creditors with a civil money judgment may garnish 25 percent of a judgment debtor’s weekly disposable income, if the state allows it. Disposable income is the amount of wages left after taxes and other legally required deductions are removed. Some states, such as Pennsylvania, only allow wage garnishment for child support and tax debt. Federal law sets a 25 percent guideline for wage garnishment, but individual states have the option to adopt the federal guidelines or to make adjustments. If the state law differs from the federal guidelines, employers must follow the law that results in the smaller garnishment.
Levy
-
A civil money judgment may give a creditor the right to take money from a judgment debtor’s bank account. Called a levy or a garnishment, the creditor typically must present the exact account information along with a copy of the judgment to the court to obtain a writ of garnishment or levy. State laws vary regarding the procedure and the legality of account levies. In some states, a judgment creditor may legally attach a levy to rent payments, lottery winnings and other settlements owed the judgment debtor.
-
Lien
-
In some states, a judgment places an automatic lien on any real property owned by the judgment debtor. In others, the judgment creditor must file separate paperwork and pay a fee to legally attach a lien to real property. A lien clouds the title to the real property, making it impossible to sell or refinance until the lien is satisfied. States with homestead exemption laws protect a portion of the debtor’s equity, if the property is their primary home. If the home is protected, the judgment creditor cannot force a sale.
Seizure
-
Judgment creditors may also legally seize personal property that is not exempt in order to satisfy a judgment debt. Each state specifies personal property and values of the property that are exempt from seizure. For example, state laws may specify that household furnishings in an aggregate amount of $2,500 are exempt from seizure or they may exempt tools used for a trade.
-
