subject: Do You Wonder How To Pressure Your Judgment Debtor? [print this page] For both debtors and judgment creditors, there are many advantages in settling the judgment between them, as compared to the normal extended enforcement procedures to recover judgments. My articles are my opinions, and is not legal advice. I am a judgment broker, and not an attorney. If you ever need legal advice or a strategy to use, you should contact a lawyer.
It takes two to tango. For judgment creditors, what's needed is a realization that judgments are not cash and that (e.g.) half of something is better than one hundred percent of no money. In judgment enforcement, everything depends on the debtor. With certain cases, when you have poor judgment debtors for example, if one compares settling for a small fraction of what's owed; with the debtor filing for bankruptcy protection, that small fraction settlement is a big victory.
With debtors, what is needed is an understanding that if they have available assets, including all personal assets of value; they're much better off by settling. If they do not settle, they might be exposed to potential legal actions to enforce the judgment on them, during the life of the judgment. Some enforcers have garnished the judgment debtor's pet! Settling avoids a bunch of hassle and avoids extra costs; for example the accruing interest owed, expenses the judgment owner incurs with the court, the Sheriff, and perhaps process servers.
When either a judgment creditor or the debtor is not flexible and realistic enough, settlement efforts will not succeed. The judgment debtor requires more than an intention to settle, they also need the money to settle with. If judgment settling works, the judgment owner gets paid; and the judgment debtor gets their judgment satisfied, so nobody can ever legally bother them about that judgment anymore.
The number one thing that causes failure with settlement agreements is when the debtor does not pay the judgment owner. The creditor must be careful to put in writing, that should the debtor not pay the required amount on time; the agreement to settle is void, and the original amount is now owed, and judgment enforcement actions will commence and repeat until the judgment is satisfied.
While taking care to never threaten the judgment debtor in any way, politely remind them of the hassles, expenses, and time duration of regular judgment recovery procedures. Without making any kind of threats, tell the debtor that you're serious in settling or enforcing the judgment, and all of the possible options available to you, without implying that you plan any particular procedure or action.
Sometimes, a first settlement offer comes when the judgment owner mails a first "request for payment" to the judgment debtor. When the judgment has been around for long enough for significant interest to have been earned, then one may decide to offer a break for a portion of, or all the accrued interest, with prompt payment.
With every offer to settle, it is a good idea to write in a time limitation. Common time limits are between ten to thirty days. If the debtor snoozes or flakes, they lose. All later agreements should have less of an advantage to the judgment debtor than your previous agreements. This way, your debtor will see that the more they flake, the harder it will be for them to get any type of discounts.
When the judgment debtor begins to make settlement offers or counter-offers, that's good, and one should "strike while the iron is hot". Respond to all offers initiated by your debtor with a counter offer that is more advantage to you, than their offer. For example, if the first offer to pay you $90 a month for 26 months, you might come back with your proposed offer of $125 a month for 19 months.
If your debtor presents you an offer, you can assume their offer is one they are comfortable with. What you may not know is whether the debtor's offer is the most the debtor can reasonably afford. Responding to them with a counter-offer may reveal what they can actually afford to pay. Getting some money every month is more fun than not getting any money.
If the debtor really cannot afford to pay more than their first offer, take that first offer. If they request that you give up the interest owed, one might agree to discount or skip the interest only after the debtor has promptly completely every term of the agreement.
Whenever you reach a settlement with your debtor, make certain that every detail is ironed out, and everything is in writing. Approach the judgment settlement in a businesslike fashion. Make it crystal clear that if your debtor fails to adhere to the specific terms of the agreement, any discounts and deals are void, the full amount is due, and you will be free to recover your judgment at full force.
