Having a civil judgment entered against you means having a legal responsibility to pay a debt. The judgment also gives your creditor, or a judgment collection agency, the legal authority to take certain actions against you. Those actions are designed to collect what you owe.

Judgment collectors and debt collection agencies are often viewed negatively. But they are just doing their jobs. There would be no need for them if people simply made good on their debts. However, that’s a different topic for a different post. The main topic for this post is the three ways judgment collectors typically collect on bad debts.

If you have a judgment entered against you, expect to be contacted by the creditor or a collection agency. Your best bet is to work with the creditor using the first option on the list. Moving on to the second or third could mean more bad news for you.

1. Negotiating a Payment Plan

Judgment Collectors, a Salt Lake City agency specializing in judgment recovery, says negotiating a payment plan is the best way to go. This allows for you and the creditor to settle the debt between yourselves without any further action. Creditors are usually willing to work with debtors for the simple fact that regular monthly payments are better than nothing.

Of course, agreeing to a payment plan is only suitable if you actually make good on it. It is advised that debtors and creditors work together to come up with something reasonable. Trying to extract too much too fast could only land the debtor in more trouble.

2. Recovery Through Attachments

Creditors unable to work out reasonable payment plans may choose recovery via attachment. What is an attachment? In essence, it is a legal claim against the debtor’s assets. The creditor takes legal possession of an asset, then sells that assets to recover the unpaid debt.

Nearly every state distinguishes between exempt and nonexempt assets. A person’s primary residence is exempt in most states. A vacation property is not. Furthermore, equity in that private residence is also not exempt. The creditor could take possession of both.

Most states do not classify cars as exempt assets, either. Yet a debtor could make a claim of exemption in court, with the understanding that the car is required to get to and from work. It would be up to the court to determine whether or not to grant the exemption. If not, a creditor could seize the debtor’s car and sell it.

3. Recovery Through Garnishment

Judgment collection services tend to look at nonexempt assets before wage garnishment. But if there are no assets to speak of, wages are certainly on the table. A debt collector can garnish a debtor’s wages up to the legal limits of state law. Garnished wages are deducted from the debtor’s paycheck and submitted directly to the credit.

There are two things to remember in this regard. First is the fact that unemployment income is exempt in most states. Thus, a debtor whose only source of income is unemployment insurance would not be subject to wage garnishment.

The other thing to consider is that attorneys and advocacy groups sometimes encourage debtors to not reveal employment information. The point here is to thwart any efforts to garnish wages. But any such efforts are usually only temporary in their results. Creditors can take debtors to court in order to force that information out.

Now you know the three ways judgment collectors do what they do. If you have judgment entered against you, do your best to accommodate the first option.