liens and writs of execution. Although both tools involve leveraging debtor assets to collect, they are distinct and different.
If you are ever subject to either a judgment lien or writ of execution, take note that it is serious business. A judgment lien jeopardizes your property until what you owe is paid off. More importantly, a writ of seizure dictates that you are actually going to lose that property.
A Quick Word About Judgments
A judgment is a decision in a civil court case. Civil courts determine liability in disputes not covered by criminal law. So where a criminal court renders verdicts, civil courts render judgments. A judgment involving a monetary payment to the winning party is sometimes referred to as a ‘money judgment’.
The interesting thing about money judgments is that courts do not get directly involved in collection. They only intervene when creditors file new petitions. Otherwise, creditors and any other representatives they bring in to work on their behalf are responsible for collection.
Judgment Collectors is a Utah-based collection agency with headquarters in Salt Lake City. They work with judgment creditors in eleven states to collect money judgments. Creditors might turn to them rather than leaving collection to their attorneys.
The Judgment Lien
Judgment Collectors explains that a judgment lien is a lien placed on personal property. Note that states regulate judgment liens differently. A significant number of states place judgment liens on debtor property by default. As soon as a judgment is entered against a defendant, a judgment lien automatically follows.
In other states, creditors must file judgment liens separately. A lien needs to be filed in the county where the personal property is located. So if the property is not in the same county as the original lawsuit, the judgment must be recorded in that county before a judgment lien can be filed.
A judgment lien establishes a financial interest in a piece of real property. The debtor cannot sell, transfer ownership, or otherwise dispose of the property without paying his debt. A judgment lien typically only lasts a few years, but nearly every state allows renewals.
The Writ of Execution
A judgment lien this serious. But a writ of execution is even more so. A writ of execution is a court order giving the local sheriff authority to seize a piece of property and sell it at auction for payment of the judgment. Where states differ is in the types of property that are considered exempt.
Nearly all of the states make a debtor’s primary residence, or a portion of its value equal to the state’s homestead exemption, exempt from writs of seizure. A smaller number of states protect a debtor’s primary vehicle, which is a vehicle necessary to get to and from work.
What types of property are nonexempt? Here is a short list:
- Vacation and rental properties
- RVs, boats, recreational vehicles, planes, etc.
- Jewelry and valuable collectibles like coins, sports memorabilia, etc.
- A variety of securities
Judgment creditors tend to turn to writs of execution as a last resort. They prefer to set up payment plans when lump sum payments are impossible. Seizing a person’s personal property is never a pleasant thing, but it is sometimes necessary.
Both Are a Big Deal
Despite judgment liens and writs of execution being distinct and different, they do share one thing in common: both are a big deal. You don’t want to be on the losing end of either one.
