Time: A Creditor’s #1 Enemy in the Judgment Collection Game

If you had to guess at the biggest obstacle creditors face when trying to collect judgments, what would you say? If time were your answer, you would be absolutely correct. Judgment creditors have a lot working against them. Still, nothing works quite as effectively as time.

Every aspect of civil litigation is governed by time constraints. Right from the start, debtors usually have a certain amount of time to respond once they have been served with a summons. Thirty days is about average. Once a lawsuit commences, there are time constraints covering everything from filing motions to giving debtors enough time to appeal judgments.

Only So Much Time to Collect

Capping off the legal time constraints are statutes of limitations. Most states limit the amount of time creditors have to collect. If they fail to do so, they must either let their judgments expire or go back to court to renew them. The average statute of limitations on judgments is 7-10 years.

The statute of limitations is more important than most judgment creditors note. Why? Because debtor attorneys are smart enough to educate their clients about such limitations. Once a debtor knows what the statute is in his case, he can devise a strategy to avoid paying until the limit is reached.

Every Passing Day Makes Things Harder

While a debtor attempts to stall for time, the creditor is trying to find creative ways to extract payment. The creditor might attempt to set up a payment plan. Wage and bank account garnishment might be considered. Even property liens could be on the table. But every passing day makes things harder on the creditor.

Things get harder with time because debtors have more opportunities to stall. Over the course of several years, debtors can:

• Switch Jobs – Switching jobs without informing the creditor can bring an abrupt halt to garnishment efforts.

• Move Away – Moving out of town, or even out-of-state, makes it harder for creditors to keep track of debtors and their assets.

• Hide Assets – Speaking of assets, time offers the opportunity to hide assets a creditor hasn’t yet discovered. Assets can be transferred to family members. They can be sold and the proceeds stashed away.

Plenty of other strategies are in play here. The more strategies a debtor utilizes, the harder it is for the debtor to collect. Time just affords a debtor more opportunity to employ more strategies.

Get a Collection Agency Involved

At this point, you might be wondering what creditors can do to fight back. The best possible move is to get a collection agency involved right from the start. Contacting a collection agency on the same day a judgment is rendered gets the agency in on the ground floor.

A judgment collection agency like Judgment Collectors puts knowledge, experience, and skill in the creditor’s corner. And if the collection agency is engaged on day one, the creditor has an instant advantage that can be difficult to overcome.

On the other hand, the debtor gains the advantage when creditors attempt to collect on their own. Even six months of in-house collection efforts can put a creditor way behind. Engaging a collection agency at that point is still better than continuing as-is, but the agency will have a lot of ground cover.

When it comes to collecting judgments, time is a creditor’s #1 enemy. It is critically important for creditors to begin collection efforts as soon as they are allowed to do so. And if that involves engaging with a collection agency, the chances of getting paid are surprisingly good.