How can creditors collect from me?

If you owe a debt, how can a creditor collect from you?  The first, and most common way, is to persuade you to pay voluntarily.  This is normally done through telephone calls, and letters.

If you cannot, or are unwilling to come up with the amount or the terms the creditor is willing to accept, the creditor’s next step is to get to you to pay involuntarily, that is, through court action.

If the debt is a consumer debt, the creditor must first file a lawsuit, and then get a judgment against you, before taking money or property from you without your consent.  A "judgment" is simply an order from a court stating that you owe a certain amount to the creditor, and that the creditor may now exercise whatever legal options that are available to collect the judgment.

The most common ways to collect judgments include:

WAGE GARNISHMENT.  If you are working for someone else as an employee, that is, for wages or a salary, the creditor can get a portion of your wages – normally up to 25% of your take-home pay.

BANK LEVY.  If the creditor can find out where your bank account is, the creditor can serve a levy on your bank, requiring the bank to withhold whatever funds you have at the bank.

LIEN ON REAL ESTATE.  If you own real estate, the creditor can put a lien on your real estate.  The lien will normally be paid off when you sell or re-finance the property.  Theoretically, a creditor could force a sale of the property in order to collect the debt.  As a practical matter, this happens rarely in California.

JUDGMENT DEBTOR EXAM.  This is not really a way to take money from you, but is designed to make life so unpleasant that you will want to pay.  The creditor can get an order requiring you to appear in court, and answer, under oath, whatever questions the creditor asks, and produce whatever documents (including bank documents) that the creditor requests.

If you want to discuss your unique situation with an experienced attorney, please call us at 800-455-1592 for a no charge no obligation consultation.

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