Once a creditor has obtained a judgment against you, chances are they will likely attempt to enforce it. There are many collection tools available in this regard depending on whether collection is sought against a business or individual.
The following are the most common ways a judgment creditor will seek to satisfy a judgment:
1) Wage Garnishment: If you are employed as a W-2 employee, a judgment creditor can attempt to garnish your wages to pay off the judgment amount. Under a wage garnishment, your employer is served an order to withhold your pay. The creditor is generally limited to 25% of gross wages per pay period. Wage garnishments are not very effective on self-employed individuals since it is difficult to force someone to withhold and turnover their own wages.
2) Bank Account Levy: If a creditor has obtained a judgment against you and knows where you bank, a bank levy can be an effective tool. Unlike a wage garnishment where your employer is served and you are provided notice, with a bank levy, you aren’t notified until after the levy has already taken place. The reason is obvious. Many judgment debtors would remove the money from the account if they were notified beforehand. Additionally, wage garnishments are ongoing orders to withhold wages, whereas a levy order is a “one time shot” taking whatever is in the account at the time of the levy. Each subsequent levy requires a separate order.
3) Liens: The purpose of a lien is to secure payment by attaching or linking it to property. It is the best chance of guaranteeing payment on a judgment at some point in time. The most common example is a lien placed against real estate. The lien attaches to the real estate and collects interest at 10% per year. Once the property is sold, foreclosed or refinanced, the liens are paid off in the order they were placed against the property.
If you are facing any of the above, bankruptcy can help by stopping the garnishments, reversing recent levy’s, and removing existing judgment liens against your property.
For more information regarding any bankruptcy law questions, contact The Larkin Law Firm at http://www.live-debt-free-now.com
Jeffrey D. Larkin is one of the most productive debt-relief attorneys in the region. His innovative law firm is committed to providing intelligent debt solutions custom fitted to his clients' individual needs. Whether you need to file bankruptcy, re-organize your debt or re-build your financial structure, Mr. Larkin provides a full range of legal services designed to restore financial order to your life.
Mr. Larkin is a California licensed attorney offering services throughout San Diego, Orange, Riverside and San Bernardino Counties. A 1998 graduate of California State University, San Bernardino, Mr. Larkin earned his Juris Doctorate from Thomas Jefferson School of Law in 2002. Since that time, Mr. Larkin has focused exclusively on bankruptcy and insolvency related matters, and has authored dozens of articles regarding bankruptcy and other debt solutions.
From 2002 through 2009, Mr. Larkin served as an associate attorney for the two largest bankruptcy filing firms in San Diego County. During that time, Mr. Larkin handled thousands of cases, and gained invaluable experience serving a broad and diversified client base. In 2008, Mr. Larkin was one of the top five bankruptcy filers in all of San Diego County, according to the United States Bankruptcy Court, Southern District of California.