For many of us who are in the judgment recovery industry, we often forget that the rest of the world may not really have a clue about what “Judgment Recovery” is. As with many industries, we are so used to throwing around terminology like “skip tracing” and “asset location” that we just assume everyone else understands.
Here’s a simple example of the whole process, in plain English…
We’ll start from the very beginning. Imagine, if you will, that you’ve rented a home for several years. Situations change, and you’ve decided it’s time to move. You kept the property in great shape, always paid rent on time, and certainly didn’t trash the place, so you’re looking forward to getting your deposit back.
After the move, your landlord decides to be greedy and won’t return your deposit. What?! Your demand for an explanation goes unanswered, so your only real option is to file a lawsuit in small claims court.
The Court Date
You’ve filed your papers with the court to request a hearing and served the landlord with notice of the hearing date. The court date arrives and both you and the landlord argue your case in front of the judge, who decides that you are right and the landlord must return your deposit. A judgment is awarded for the amount of the deposit, plus any court fees you had to pay.
A week goes by… and you haven’t received any payment. But the landlord (now he’s called the judgment debtor) technically has thirty days to cough it up, so you’re trying to be patient. Now three months have passed – and still no check. At this point you call the court to tell them that the judgment debtor has still not paid, and you want to know what they’re going to do about it. Shockingly, the answer is nothing. Guess what? It’s up to you to make the judgment debtor pay. The court will not enforce the judgment for you. You’re on your own…
The Judgment Recovery Specialist
Time flies when you’re living your life, so three years have flown by and you’ve given up hope long ago that you’ll ever see a dime from that crooked landlord. Then one day you receive a letter from Statewide Judgment Recovery. Of course, this letter sparks your curiosity, so you open it.
It isn’t exactly what you were expecting, but perhaps the next best thing. This company is telling you they’ve seen your judgment at the courthouse and noticed it hasn’t been paid. They want to know if you’d be interested in letting them enforce the judgment. Since the company is willing to pay for all of the fees associated with collecting the judgment up front, no money will come out of your pocket.
Figuring that you have nothing to lose, you call the company and take a few minutes to discuss your case with a friendly and helpful person on the phone.
Let’s give this faceless judgment recovery person an identity. Let’s call him Jim. Jim is a highly trained, specialized kind of dynamo. He’s equipped with every skill he needs and all the latest tricks of the trade to make sure you get your money.
Jim tells you that he will do everything necessary to enforce the judgment in exchange for 50% of whatever is collected. It really just turns out to be a simple matter of signing a couple of agreements.
After Jim receives your signed agreements, he files them with the court and is ready to dig his heels in and get started.
The Pursuit Begins!
This is a no-brainer for Jim – this case is a slam dunk for a go-getter like him. Since the landlord owns rental property, and you’d passed along copies of past cancelled checks written for the rent, it’s a simple matter to collect this judgment.
When a judgment is assigned to someone like Jim, he becomes, in the eyes of the law, the judgment creditor and new owner of the judgment. He has exactly the same right of enforcement that you had to use the powerful legal remedies provided by law to force the judgment debtor to pay the debt. Actually, the landlord now owes the judgment to Jim.
Jim files a form with the court and sends the sheriff over to the landlord’s bank to seize the money in the account. A bank account seizure freezes all of the money in the account from the moment it is delivered to the bank.
The money in the bank account was not quite enough to cover the entire judgment amount, so to collect the remaining balance, Jim again sends the sheriff – but this time to intercept any incoming rent from the current tenant residing at the rental property.
When Jim receives a check for the money collected by the sheriff for the rent and from the bank account, he adds the filing fees that he incurred to the judgment. The crooked landlord will ultimately pay for them. Then he keeps half for himself and mails a check for the remainder to you.
The ending to this story is a happy one. You receive a substantial chunk of the money that was owed to you and Jim gets a hefty well-deserved sum as well. The icing on the cake… Jim discovers that the landlord has several other judgments awarded against him, and decides to contact those judgment holders to help them get their money, too.
If there are any other topics you’d like to see discussed on this blog, please feel free to leave a comment and I’ll do my best to cover them for you!