Timeline of a Consumer Debt Lawsuit: Collecting the Judgment

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In our series Timeline of Consumer Credit Lawsuit, we've talked about what happens before a lawsuit is filed, the course of a lawsuit, and steps the parties can take after the judgment is rendered to challenge the judgment. In this article, we discuss how creditors use judgments to collect on debts.

If you lose your court case, the judge will enter a judgment, which is a formal pronouncement from the court. If the court has awarded the other party money, the judgment will list the amount, any interest that's accrued from the time the case has been filed, and the interest rate. The judgment can also order you to take some action or to refrain from taking some action. For instance, you can be ordered to turn over certain property to your opponent or to pay your opponent's attorney's fees and costs.


Recording the Judgment in the Real Property Records

Once the judgment has been entered by the court, there's usually a period of time in which the parties can appeal the decision to a higher court. The judgment is not considered final until that time has passed.

Once final, the creditor’s first action will generally be to file the judgment in the county property records for the county in which you reside. The property records are public, meaning anyone can see them. This puts the world on notice that the creditor has a judgment against you.

The judgment also serves as a lien against your property. The lien is similar to the rights your car creditor has in the car you’re financing. But the judgment will act as a lien against all of your property, including real estate listed in the property records, real estate not listed in the property records and all personal property, including cars and even clothing and dishes in the cupboard.

Using the Judgment to Collect a Debt

    Post-judgment Interrogatories

After the judgment is taken, the creditor might send you a set of questions called interrogatories. These interrogatories are designed to elicit information about your assets, including real estate, personal property, bank accounts and wages.

If you fail or refuse to answer the interrogatories, the court can hold you in contempt of court and fine you a significant amount of money, although the court will not usually throw you in jail on a civil contempt charge.

    Settling the Judgment

Although creditors have several tools at their disposal to force payment of the judgment, most creditors would prefer to negotiate a settlement with you even at this late date. Active collection using the tools we describe can be expensive and often fails to generate enough proceeds to actually pay the debt in full. It is almost always in your best interest to attempt to work out a payment plan or offer a lump sum settlement on the judgment.


If you cannot or will not work out a compromise or a payment plan, but you have some assets that could be used to pay the debt, the creditor has options.

First, it can sit and wait until you sell property, especially real estate. When you receive an offer on property, a title company will review the property records to ensure that you have the right to sell it. During this review process, the title company will discover the judgment and require that you clear the judgment as a condition of issuing title insurance for the sale. You can clear the judgment with proceeds of the sale, out of your pocket, or by securing an agreement with the creditor to release the judgment.


Second, the creditor can go back to court and ask that property be sold to pay the judgment. This is called a levy. The levy usually orders that the sheriff in the county where the property is located take possession of it, sell it and turn the proceeds of the sale over to the creditor. That could mean that the sheriff puts real property up for sale or actually removes personal property to sell. Because of the expense and trouble finding and securing personal property, creditors don't often take this route unless the property has significant value.



When the property belongs to you but is in the hands of someone else, like your checking account at the bank, the court will issue a garnishment. If the creditor wants access to your bank account, it asks the court to issue the garnishment to the bank. The court can likewise issue a garnishment for wages to your employer.

For more information on how garnishments work, see What is a Garnishment? and How to Handle a Garnishment.

Judgments and Credit Reports

People are often motivated to settle judgments when they show up on their credit reports. The creditor doesn’t even have to report the judgment to the credit bureaus. The credit bureaus routinely review property records and add judgments to their databases. Whenever someone makes an inquiry of your file with a credit reporting agency, the judgment will show up. It may remain there even though it may have a notation attached to it that it has been satisfied. In many cases, the judgment will drop off the credit report after seven years, but in some instances it may remain on the credit report as long as it is an active and executable judgment.

Duration of Judgments

Judgments are usually active for ten years. In some states, they are active for as few as five years; in others for as long as twenty. In many states, the judgment can be renewed for an additional term.

Bankruptcy and Judgments

Can you get rid of a judgment or stop a garnishment by filing a bankruptcy case? A bankruptcy can stop a garnishment, but it will only get rid of a judgment if the debt is dischargeable in the bankruptcy. Learn more here about what's dischargeable and what survives a bankruptcy.  

For more, visit:

Timeline of a Consumer Debt Lawsuit: Pretrial and Trial

Timeline of a Consumer Debt Lawsuit: Before the Lawsuit is Filed 


Updated by Carron Nicks August 2017