You have been sued in civil court and subsequently lost your case. You are now facing a monetary award you are compelled to pay. You have heard stories about other judgment debtors who faced years of collection efforts at the hands of attorneys and collection agencies. You want to avoid that. How can you do so?
You basically have three options:
- Pay the entirety of what you owe right away.
- Work out an amenable payment plan with the creditor.
- Prove to the creditor that you are genuinely judgment-proof.
In the absence of one of these potential solutions, you are likely to face collection efforts. Some judgment creditors try to collect on their own. Others turn collection over to their attorneys or bring in a specialized collection agency like Salt Lake City-based Judgment Collectors.
Pay What You Owe Right Away
The easiest way to avoid collection efforts and get the whole issue settled once and for all is to pay what you owe. In all likelihood, your judgment includes the initial financial award as well as the judgment creditor’s court costs and attorney’s fees. You might also be compelled to pay interest and a variety of penalties based on the details of the case.
You may not have enough money to cover the judgment. You can always ask friends and family members for a loan. You could also consider cashing in some investments or, if your plan allows, taking a loan against your retirement account.
Work Out a Payment Plan
Believe it or not, Judgment Collectors says that creditors are usually more than happy to work out payment plans. They know that pursuing other means of collection takes time and costs money. It is much easier for them to accept monthly payments from you.
Should you decide to go the payment plan route, know this one thing: agreeing to a payment plan and then not sticking with it could lead to even more uncomfortable circumstances. Your creditor is being gracious by agreeing to a payment plan. Do not betray that grace and trust by not making promised payments.
Proving You Are Judgment-Proof
It could be that you legitimately do not have the money or assets to make good on what you owe. Meanwhile, you don’t have any decent prospects for the future. You believe the chances of ever being able to pay the debt are slim to none. You would be what is known in the debt collection industry as ‘judgment-proof’.
A judgment-proof debtor is not worth the time and effort to try collecting from. Judgment creditors do not want to spend years chasing a debt they will never collect. They also don’t want to spend the money on collection efforts. Here’s the thing: you would have to convince the creditor you truly are judgment-proof. If you make the case when you really are not, you can expect collection efforts in earnest.
A Word About Avoiding Payment
This post has offered three possibilities for avoiding collection efforts after losing a civil lawsuit. Avoiding collection efforts and avoiding payment are two different things. Unfortunately, attorneys sometimes advise clients on how to avoid payment by hiding assets, providing inaccurate employment information, and even skipping town. Do not heed any such advice.
Trying to avoid collection efforts is one thing. Trying to avoid payment is something entirely different. Collection agencies and private detectives are exceptionally good at tracking down judgment debtors trying to hide themselves and their assets. Not only that, but modern digital technology also makes their job even easier. The chances of you getting away with not paying are not as high as you would expect.
