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Real Estate Holdings: Here’s How to Use Them in Collecting a Civil Judgment

A civil judgment is a court order that legally requires one person or entity to pay money to another. Judgments can arise from a variety of civil court cases, including breach of contract, personal injury, or failure to pay a debt.

Once a judgment is entered, the losing party (the “judgment debtor”) is typically required to pay the winning party (the “judgment creditor”) a set amount of money. If the judgment debtor fails to do so, the creditor may take steps to collect the debt, including wage garnishment or seizure of assets.

Targeting Real Estate for Collection

For many people, their biggest asset is their home. For businesses, it may be the property they own. As such, creditors may attempt to levy judgments against real estate holdings in order to recoup debts.

In most cases, a creditor must first obtain a writ of execution from the court in order to conduct a levy. (More on that in a moment.) Once the writ is obtained, the sheriff’s office will notify the debtor that their property is about to be sold at auction to satisfy the debt.

Collecting on a Civil Judgment

If you’ve been the victim of a civil wrong, you may be entitled to damages in the form of a monetary judgment. But simply obtaining a judgment is only half the battle. The next step is actually collecting on that judgment, which can be difficult, especially if the person against whom you have the judgment doesn’t have any money or assets.

There are a few different ways to collect on a civil judgment. One is to garnish the debtor’s wages. This means that money will be taken directly out of the debtor’s paycheck and given to you. However, this can only be done if the debtor has an ongoing source of income.

Another way to collect is to seize the debtor’s assets, such as their bank account or their property. However, this can be difficult to do on your own, and you may need to hire an expert in judgment enforcement to pull it off.

The best way to collect on a civil judgment is to work with the debtor to come up with a payment plan. This way, you can get your money without having to go through the hassle and expense of trying to garnish wages or seize assets.

Steps to Asset Seizure

Seizing assets is a civil law enforcement process whereby the assets of a judgment debtor are sold to raise money to pay a court-ordered debt. The sale of the assets often is conducted by a sheriff or marshal, who first gives notice of the sale to interested parties.

Proceeds from the sale are then applied to the unpaid debt. If the debtor’s assets are not sufficient to cover the debt, the creditor may be granted a deficiency judgment, which allows them to collect the remaining balance from the debtor.

Seizing an asset like real estate is typically used as a last resort after all other attempts to collect on debt have failed. However, it is important to note that seizure proceedings can be complex and time-consuming, so creditors should always consult with an experienced enforcement specialist before taking this step.

Value is one of the biggest factors when determining whether to open seizure proceedings. If the property is worth a great deal of money, as it so often is, it can safely cover the debt owed. However, the owner’s willingness to sell is always a factor. If they are resistant, it can set up a protracted legal fight that, even if you win, can end up costing you additional money.

That’s why due diligence is so important in how you go about targeting a real estate asset. First, seek a writ of execution from the court of jurisdiction. This authorizes the sheriff or other authorities to seize the property.

Once the writ is issued, a notice of the sale will become public. It then becomes imperative to advertise the sale to garner as much interest as possible. Doing so improves the odds that any proceeds will satisfy the remainder of what the debtor owes to you.

We hope this insight into the civil judgment enforcement process regarding real estate has helped broaden your understanding of the complexities and the possibilities of using a debtor’s real estate holdings to get what you are owed. If you still have questions or need assistance in the process, contact Southwest Recovery Services today!

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