Don't Sue Unless You Can Collect the Judgment

Before you sue, ask yourself whether you can collect. If you can't, think twice before filing a lawsuit.

By , Attorney · University of the Pacific McGeorge School of Law

Winning a small claims court case is exhilarating, but it's only half the battle. You've got to collect the judgment. This article explains which property types you can seize with a money judgment and efficient strategies for collecting small claims and other court judgments.

Ways to Collect a Judgment

A judgment is the court's final decision that states who won a lawsuit and the amount the losing party must pay. A judgment lets a creditor collect using collection strategies unavailable before the lawsuit.

For instance, a creditor who wins a small claims court case can withdraw funds from the losing side's paycheck and bank accounts using wage garnishments and bank account levies. Property can also be seized and attached with liens.

Example. Lorenzo received a credit card from Game Haven, maxed it out on a new game console, and didn't pay the bill. Game Haven requested payment by phone and mail with no success. After exhausting all collection options, Game Haven sued in small claims court and won. Game Haven used the judgment to garnish Lorenzo's monthly wages at his IT job and received full reimbursement within six months.

Finding a Judgment Debtor's Property

If you're dealing with a fly-by-night business with no identifiable office or headquarters or forgot to do your homework before filing the case, don't give up without a fight. Most courts will let you ask the defendant questions about assets, income, and related financial issues.

Depending on the court's procedure, you'll either send the defendant a form to complete or ask the defendant questions at the courthouse in a debtor's examination. You can also require the defendant to produce bank statements and other financial documents.

Example. William successfully sued Jesse in small claims court and received a judgment. However, Jesse refused to pay, so William set the case for a debtor's examination. On the examination date, the court directed them to the chairs in the hallway. After settling in, William reviewed Jesse's financial records and began asking questions. He learned where Jesse worked and banked and that Jesse owned a home and a boat with sizeable equity. Realizing paying the judgment was inevitable, Jesse settled the debt with William.

Property You Can Seize With a Judgment

Targeting wages and bank account balances is relatively simple and quick and is usually a creditor's first judgment collection choice. By contrast, seizing real estate and cars is expensive and time-consuming, and state law often protects all or some of the property's equity from creditors (more in the "Property You Can't Collect" section).

That said, there's a time and place for each collection method. Below is a list of assets available to a creditor with a judgment and the collection technique used to acquire them. Learn tips for collecting your judgment.

  • Personal income. An easy way to recover is to take a portion of the defendant's monthly wages. Most states allow a wage garnishment of up to 25%. However, the wages of very low-income workers are exempt from garnishment, and you can't garnish welfare, Social Security, unemployment, a pension, or a disability check.
  • Personal assets. You can withdraw funds from a bank account or levy on property, such as real estate, cars, stocks, and bonds. You can't seize everything a defendant owns, however. Defendants can protect some things they need to work and live (more below).
  • Business income. A business bank account and a cash register are two good sources of business income. If a company takes in money daily, the chances are excellent that the sheriff or marshal will take the cash out of the debtor's bank account or register using a "till tap."
  • Business assets. A valuable piece of equipment or machinery can be sold to pay your judgment, especially if the business owner signed a contract giving you a lien on the business property.

Protecting Judgments With Liens

Once you have a judgment, it's a good idea to record it with the recorder's office because it puts a lien on the defendant's real estate. If the debtor sells the property, you'll be paid before title transfers to the new owner.

Also, you'll have a better chance of being paid if the debtor files for bankruptcy (more below). You can also create liens against personal property by filing with the Secretary of State or a similar agency.

Example. Nicole sued Marcos, won a $50,000 judgment against him, and filed the judgment with the recorder in the county where he owned a home. Ten years later, Marcos sold the house, and Nicole received a check for the total amount of the judgment.

Other Judgment Collection Options

Your state could provide other strategies to help "encourage" a judgment debtor to pay you.

Suspending Driving Privileges

In some states, a judgment debtor's driver's license can be suspended by the Department of Motor Vehicles if the debtor doesn't pay a judgment stemming from an auto accident. However, to get rid of the debt and avoid the suspension, the debtor might decide to declare bankruptcy.

Before that happens, you might want to try negotiating with the debtor. If you work out a payment plan, you get your money, and the debtor doesn't have to declare bankruptcy. Everybody wins.

Revoking Professional Licenses

If your lawsuit is against a building or remodeling contractor with a current license, some states, including California, allow you to file the judgment with the state licensing board. If the contractor doesn't pay it off, post a bond, or file for bankruptcy, the contractor could lose the license.

Ordering Installment Plans

Your court might help you collect by ordering the defendant to pay the judgment directly to the court through an installment plan. This benefit is provided primarily by small claims courts. Most courts offering this service will include the details on the court website.

Property You Can't Collect

Not all property is fair game when you have a money judgment. Debtor protection laws keep you from seizing and selling many types of property, including the food from the debtor's table, the clothing from the closet, and the TV from the living room.

Seizing and selling the debtor's car will also be difficult because most states protect a debtor's motor vehicle from creditors up to a certain amount of equity. The protected equity amount might increase if the debtor uses the car for business purposes.

In most states, the amounts protected from creditors are the same in and out of bankruptcy. Learn the amounts judgment debtors can protect by reviewing the state bankruptcy exemption laws.

When You Can't Collect the Judgment Now

You can't collect a judgment unless the person sued has assets you can attach or seize with a money judgment. A person without assets or only assets you can't take is called "judgment proof."

Don't expect to get paid soon when suing someone who is judgment proof. You'll likely need to renew the judgment until the person recovers financially, finds a job, and accumulates attachable assets (more below).

Example. Althea retired five years before and occupied her time shopping online. Because of the cluttered state of her apartment, she lost the invoice from Candle Oasis. After a year without payment, Candle Oasis sued and won. However, it could not collect the judgment because Althea owned nothing of value, and federal law fully protected her Social Security income from creditors.

Learn when not to sue and why suing a judgment-proof person might not be worthwhile.

Renewing the Judgment

As discussed above, sometimes, a judgment-proof person doesn't own anything you can currently seize with a money judgment. However, except for retired people or those with permanent disabilities, most people's financial outlook will improve with time. College students are good examples of people who often later become solvent.

The problem is that judgments usually expire after five to 20 years, depending on the state. Fortunately, if you can't collect within that period, most states will let you extend the collection time by renewing before the judgment expires.

Not only are renewed judgments often valid almost indefinitely if your state allows unlimited renewals (more below), but they accrue interest while unpaid.

Tip. You'll want to record the renewed judgment to ensure you retain certain lien rights.

Example. Melanie forgot about a $10,000 judgment a credit card creditor got against her in college. After graduating, she secured a high-paying job, bought a house, and raised children. Years later, Melanie received a call from a debt collector who had recently purchased the judgment that the previous owner had renewed unfailingly. She learned that her balance had soared to over $35,000 with interest and that the collector planned to seize her home if she didn't pay. Because of the substantial equity in Melanie's home, she had to pay the old, forgotten debt or lose her home.

Judgment Renewal Periods by State

To find out your state's rules, see the chart below. Also, be aware that the expiration periods might differ if you collect on a judgment initially entered in another state.


Small Claims Collection and Renewal Period








10; 5 in Justice of Peace Courts




20; 6 in county courts





District of Columbia












































New Hampshire


New Jersey


New Mexico


New York


North Carolina


North Dakota










Rhode Island


South Carolina


South Dakota














West Virginia




Contact your small claims court clerk's office or visit the court's website for information about renewing judgments.

Bankruptcy and Judgment Collection

Collecting isn't always easy, and if a company or individual has already filed for bankruptcy, you might be out of luck. But not always.

Some Judgments Aren't Dischargeable in Bankruptcy

If the judgment's underlying debt is dischargeable in bankruptcy, the judgment will also be dischargeable. For instance, bankruptcy will wipe out a judgment for a credit card debt but not a tax debt. Find out about nondischargeable debts and bankruptcy discharge.

However, some exceptions exist. The creditor must ask the court to declare the judgment debt nondischargeable if it's a fraud judgment. Most bankruptcy courts will declare debts nondischargeable based on existing judgments and not require a full trial. Without a judgment, the creditor would need to prove fraud in an adversary proceeding.

Example. Andrew received a family court judgment against his ex-wife Sarah for $50,000 in spousal support and $150,000 as an equalizing property division payment (Sarah kept the house). Sarah consulted a bankruptcy lawyer and learned she couldn't discharge either debt in Chapter 7. In Chapter 13, she'd need to pay the spousal support portion in full through the Chapter 13 plan. However, she could discharge the $150,000 equalizing payment. Sarah filed for Chapter 13, paid $834 for 60 months ($834 x 60 = $50,000) for the spousal support balance, and discharged the equalizing payment.

Example. Joseph's previous business partner Reed sued him in state court for fraud and won a $150,000 judgment. As a last-ditch effort to avoid paying it, Joseph's lawyer advised filing for Chapter 7 bankruptcy. However, Reed didn't abandon the matter as hoped. Instead, he asked the bankruptcy judge to declare the fraud judgment nondischargeable. The judge granted the request, and Joseph remained responsible for paying $150,000 judgment after bankruptcy.

Liens Often Remain After Bankruptcy

Even if the debtor can erase a judgment, the debtor might not be off the hook if a judgment lien was in place before the bankruptcy filing. Why? Because filing for bankruptcy doesn't automatically remove liens. If a lien remains after bankruptcy, the lienholder can recover the liened property, even though the bankruptcy court eliminated the underlying debt as part of the bankruptcy.

A bankruptcy filer can file a motion asking the court to remove a judgment lien if it prevents the filer from protecting or "exempting" property they'd be entitled to keep in bankruptcy. The bankruptcy court will remove the lien from the portion the filer can exempt in the state.

Example. Kasey won a $300,000 state court judgment against Frank, and Frank filed for bankruptcy five days later. Frank thought he could wipe out the judgment by filing quickly. However, Kasey recorded a lien against Frank's home the day after receiving the judgment before Frank filed for bankruptcy. Frank can ask the court to remove the lien, but the court will only remove it to the extent that it impairs Frank's homestead exemption or up to $100,000. Frank could have avoided the lien by filing for bankruptcy before Kasey received a judgment and recorded it against Frank's home.

Benefits of Offering Credit After Bankruptcy

Some creditors don't want to do business with someone who has recently declared bankruptcy. The belief is that bankruptcy proves the debtor can't pay the debt. But that's not always the case.

Most people who file for bankruptcy are employed, leaving the possibility of garnishing the bankruptcy filer's bank account. Also, the debtor must wait several years before filing for bankruptcy again. As a result, if the debtor doesn't pay the debt, you'll have plenty of time to sue and collect new debt without fear that a bankruptcy filing will erase the debt.

Example. A year after filing for Chapter 7 bankruptcy, Bradley's car breaks down and is beyond repair. He can't afford a car outright and is concerned he won't qualify for financing. He learns his local car dealer has a program for people with recent bankruptcies and is soon on the road again. The dealership considers Bradley an acceptable risk because Bradley won't be able to file another Chapter 7 for seven years.

More Information About Collecting Judgments

Many lawyers can help you collect a judgment for a reasonable fee. If you'd like to collect your judgment personally, you'll find more information about collecting a judgment in Representing Yourself in Court. Also, for a detailed guide to suing someone successfully, get Everybody's Guide to Small Claims Court, by Cara O'Neill (Nolo).

Updated December 4, 2023