You’ve obtained a judgment against someone who owes you money. Now, how can you collect?
Collection in General
When someone owes you money and will not pay voluntarily, you (the creditor) can seek a judgment against that person (the debtor) in court. A judgment gives you access to a number of legal methods for collecting what you are owed, or satisfying the judgment. The most common collection methods are levies, liens, and garnishments, each discussed briefly below.
Identifying the Debtor’s Assets
An important first step in determining which collection method(s) to pursue is identifying what assets the debtor has that may be levied upon, attached, or garnished to satisfy the judgment. For example, a creditor may seek to levy upon the debtor’s expensive sports car, attach a lien to the debtor’s vacation home, or garnish the debtor’s wages. A debtor’s assets can be identified using credit reports, background checks, title records, internet searches, and even engagement of a private investigator, depending on the circumstances.
One method for identifying the debtor’s assets for collection purposes is conducting debtor’s interrogatories, which are in-person or written proceedings in which the debtor must answer questions about their assets, employment, and finances. If the debtor fails to comply, they can be held in contempt of court.
Once you identify which of the debtor’s assets can be used to satisfy your judgment, you can pursue collection using the procedures described below.
Levying is a collection procedure by which the local sheriff seizes the debtor’s property and sells it in a public execution sale. A creditor can seek to levy on a debtor’s real property (e.g., house or condo) or personal property, whether tangible (e.g., a vehicle) or intangible (e.g., a business interest or intellectual property). To do so, the creditor files a writ of execution with the court and submits it to the local sheriff, who then completes the levying and execution-sale process. The proceeds of the sheriff’s execution sale are first applied toward the costs of the sale, and are then applied toward satisfaction of the creditor’s judgment.
A judgment lien is a collection procedure by which the creditor may acquire a right to be paid when the debtor sells real property to which the lien is attached. In Oregon, a judgment lien automatically attaches to the debtor’s real property that is located in the county of the court that issued the judgment. To attach the lien to real property that is located outside of that County, the creditor may record the judgment in the county clerk lien record in the county where the real property is located. Depending on the type of judgment, the lien can last between 10 and 25 years.
A garnishment is a collection procedure by which the creditor may acquire property of the debtor that is in possession, control, or custody of a third party (i.e., someone other than the debtor). For example, the creditor may garnish the debtor’s wages, directing the debtor’s employer to pay an amount of the debtor’s wages to the creditor each pay period. The creditor may garnish the debtor’s bank account, directing the bank to freeze the debtor’s funds until the judgment is satisfied. If the debtor is a landlord, the creditor may garnish rent payments, directing the debtor’s tenants to pay their rents to the creditor. To garnish the debtor’s property, the creditor must seek to have a court administrator or an attorney deliver a writ of garnishment to the third party(ies), who must then hold the property and deliver it to the creditor.