Civil courts all over this country enter money judgments on a daily basis. If you are ever on the winning end of such a decision, you might discover that the other party is not ready to pay. That person or business might even resist paying for years to come. The question is, why?
For starters, the winning party in a money judgment is referred to as the judgment creditor. The losing party is the judgment debtor. Between the two, they need to work out payment. Civil courts do not get involved in enforcement with the exception of issuing certain types of writs and/or conducting debtor’s exams.
Ideally, enforcement of a money judgment would be a simple matter. The debtor would either pay in full right away or voluntarily enter a payment plan. If neither is an option, the debtor’s attorney may propose a settlement. A settlement would typically offer a lump sum payment in exchange for the creditor accepting less than what is legitimately owed.
Reasons a Debtor Might Not Pay
The unfortunate reality of civil judgments is that debtors don’t always pay. A debtor might refuse to pay anything at all. Alternatively, a debtor may have every intention of paying but isn’t able to do so right away. Regardless, not paying doesn’t sit well with judgment creditors.
Here are some of the reasons a debtor might not pay:
- Insufficient Resources – Some debtors truly do not have sufficient resources to pay. They are cash poor with limited income. As for assets, they have very little to speak of. This sort of debtor is considered judgment-proof.
- Disagreement With the Court – Debtors sometimes refuse to pay because they disagree with the judgments entered against them. A debtor might believe the court erred but was unsuccessful in appealing the judgment. So he refuses to pay.
- Attorney Advice – Unfortunately, some attorneys advise their clients to not pay. They recommend holding out and waiting long enough for the creditor to give up and walk away.
- Pending Bankruptcy – If a debtor’s financial situation is bad enough, his attorney may advise him to not pay. Instead, the attorney advises declaring bankruptcy. A bankruptcy can eliminate most types of consumer debts with the exception of tax bills and child support/alimony.
Believe it or not, there are judgment debtors who are experienced enough to know how the system works. They have been through it before. And due to their previous experience, they consider it a game. They hold out and avoid paying for as long as they can – just because they can.
What Creditors Can Do
Creditors struggling to collect from unwilling debtors do have options. One of the best is to bring in a specialized collection agency, like Judgment Collectors out of Salt Lake City, UT. Judgment Collectors has the skill, knowledge, resources, and time to pursue judgments until they are collected.
An experienced collection agency knows how the system works. It has access to tools and resources that are not available to creditors themselves. They know how to utilize skills like skip tracing to locate debtors who are otherwise trying to hide.
This all translates into the reality, but collection agencies are equipped to do a job that most judgment creditors are not prepared for. Even small businesses with dedicated accounting departments do not have the knowledge and skill to duplicate what Judgment Collectors can do.
In my opinion, hiring a specialized collection agency is worth the money. Debtors don’t always pay. And when they choose to hold out even when they can pay up, I would rather have a collection agency on my side.
