What exactly is a judgment? I've noticed from reading here that some person have judgments placed against them because of a charge-off, while others, like myself, had a charge-off but either received no attempts to collect from an agency or a few attempts but then they petered out and stopped altogether. Are judgments maybe based on the amount of money that was charged-off, like someone who had a $10,000 charge-off would have legal action leveled against them more than someone with a $500 charge-off? Thanks for your help.
A judgment is a finding by a court of competent jurisdiction that a valid debt exists between the plaintiff and defendant. The court awards the plaintiff (creditor) the amount that the defendant (debtor) owes plus interest and court costs. After that happens the judgment is recorded in the county records, and the creditor has the legal right to collect his money using means such as liens on property, seizures of bank accounts, stocks, etc., and other personal non-exempt property. Also the creditor can garnish or seize a percentage of the salary of the debtor. These measures will continue until the judgment has been paid in full or an agreement is reached witht the creditor. As far as amounts, of course the larger the amount the more likely it is to get sued, but even for small amounts, the usual way it happens is that the creditor will wait until the SOL for collecting on the debt is almost up before starting his lawsuit. This way he maximizes the interest charges, etc. and your $500 debt suddenly becomes $1500 and then after court costs, etc, it becomes $2500! Then he can wait to enforce his judgment until the SOL to collect the judgment is almost run out, that way he can add that interest on, and after 10 years or so your $500 debt is now $5000 or more! Note: this all assumes that the creditor knows that he has a good chance of collecting against someone. If someone is really broke- ie: judgment proof- then just having the judgment means little if there is no probability of collecting anything
