How Is a Judgment Collected in Texas?

If you have successfully sought a judgment in a Texas court against a delinquent debtor, you may be wondering when you’ll receive your payment. The truth is, however, your work is only just beginning. Enforcing your judgment can be even more difficult than winning it.

Texas has long been known as one of the most debtor-friendly states, and it’s important to your bottom line to understand why the state has that reputation.

The Texas state constitution provides an unlimited homestead exemption. That means judgment creditors cannot enforce a judgment against a residence no matter how much equity the debtor has in the homesteaded property. As a result, if your debtor’s only property is considered homestead property, you will not be able to collect.

Homesteads are not the only exempt property a creditor can pursue. The list of exempt assets includes:

• Personal property up to $60,000 (if the debtor is married) or $30,000 (if single)
• One vehicle for each licensed driver in the house
• A certain dollar amount’s worth of clothing, firearms, jewelry, tools related to a job, bicycles, cattle and many other items

If a debtor does not have enough property to satisfy your judgment, that debtor is referred to as “judgment proof.”

If your judgment was issued by a Texas state or federal court, you can begin collection efforts right away for nonexempt property. However, if you have a judgment from another state— sometimes called a foreign judgment — you will need to have the judgment domesticated first. Domesticating your judgment requires filing certain documents with a Texas court and having them authenticated. This is best done with the help of an experienced Texas collections lawyer who understands the intricacies of state law.

Once your attorney identifies the debtor’s nonexempt property, the first step is to file an abstract of judgment with the county clerk. You may want to do this in all 254 Texas counties, but that gets expensive. An abstract of judgment creates a lien on the debtor’s property and warns any potential buyers that the property is not free and clear.

Additional enforcement options include:

• Obtaining a writ of execution, allowing a sheriff to seize the debtor’s property and sell it to satisfy the debt.
• Obtaining a writ of garnishment on bank accounts or investment accounts.
• Petitioning for a turnover order, in which the court names a receiver who then uses court-appointed authority to find assets that aren’t attainable through usual collection efforts. Turnover orders are rarely issued.

Your business’s ability to operate depends on recouping monies owed you. If you’re seeking a judgment against a debtor, my firm will advocate for your rights in court.

At the Law Office of Paul R. Clevenger in Dallas, I provide tenacious debt collection representation for business clients seeking to enforce judgments in Texas. To schedule an initial consultation, call 469-212-9764 or contact me online.