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What Is A Judgment?
This article is my opinion, and not legal advice. I am a judgment broker, and am not a lawyer. If you ever need any legal advice or a strategy to use, please contact a lawyer.
The person or entity suing is the plaintiff, and at the court hearing; they often become the judgment creditor. The person or entity sued is the defendant, and often becomes the debtor. Post-judgment, occasionally judges forget that the defendant did something wrong, and some try to give judgment debtors a break whenever possible.
Judgments can be issued for many reasons, the most common reason is one party owed money to another. Judgments can also begin as loans not being repaid, damage done to people or property, taxes not being paid, goods and services not paid for, theft, divorce, bankruptcy, fraud, etc.
Every judgment depends on first serving notice of the original lawsuit on the defendant. Some defendants do not show up at court after getting served, and that is the reason for default judgments. Default judgments occasionally create legal loopholes, that some judgment debtors can take advantage of.
Once in a while, a judgment debtor really was not served notice of their lawsuit. More than once, some "bad apple" process server has done a "sewer service" and tossed a court lawsuit notice into the trash. For every debtor this has really happened to; probably more than 100 other judgment debtors, will try to claim they were not properly served, but they actually were.
There are many kinds of judgments, including those from criminal courts, and civil court orders specifying that defendants not do things. Some judgments are weird, for example defendants being ordered not to place voodoo curses on the plaintiffs. Only judgments that list an amount of money owed, have any chance for possible money recovery; and they are usually civil money judgments. Judgments are not cash, they are just chances for getting some money in the future.
Unlike simple debts or claims, judgments are backed by the courts, which enable Sheriffs to attempt to levy the debtor's available assets. A common claim, such as a UCC lien, does not have the "power" of a judgment. A judgment's power is only a potential power, because there are no guarantees any judgment can be recovered.
Judgments almost always earn interest, however any interest earned is only theoretical unless and until it is recovered. Most judgments are never recovered. One reason is because you cannot simply shake your judgment debtor upside down, to see what falls out of their pockets.
The only way to recover most judgments is to pay the court and the Sheriff to attempt to levy the available assets of the judgment debtor, such as their bank accounts or wages. If your debtor is poor, sick, old, dead, in jail, bankrupt, expertly hiding their assets, or cannot be found; your judgment is probably worthless.
Most new judgment creditors become shocked to learn their judgments are not worth a lot of cash money upfront. Many creditors spend countless hours trying to find someone to buy their judgment (on their predefined terms), and never get a penny; or get any more money than their judgment debtor's situation will support. Generally, the more income and assets your judgment debtor owns and continues to own, the more your judgment may be worth someday.
Everything depends only on your judgment debtor, not on who you talk with or send your judgment to. Perhaps the biggest reason judgments do not sell for much cash upfront is, if the debtor files for bankruptcy protection, most judgments become worthless.
Most people with judgments do not understand why they cannot be sold immediately for cash, at least not until a very thorough due-diligence is done on their debtor. Creditors who demand a firm cash upfront price for their judgments are dreaming and wasting their time; because judgment buyers do not care about what creditors ask for. All judgment buyers look at, is the potential available assets of the judgment debtor. Future-payment contingency judgment recovery is a better option for many creditors, especially when you they not have to assign their judgment to anyone.
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