Legal Question in Credit and Debt Law in Pennsylvania

Re: The power of judgements

Judgments can be executed against any real or personal property owned by the judgment debtor. This includes checking/savings accounts, stock accounts (certain accounts such as an IRA may be exempt). Also subject to attachment could be real estate, motor vehicles, etc.

Wages are not attachable in Pennsylvania for credit card debt.

Property owned by both you and a spouse will not be subject to execution in a case in which you are the only named defendant.

When a credit report is pulled for your individual or a joint credit application, the judgment will most likely appear on your credit report. This should appear for a period of seven years.

Any judgment serves as a lien against real estate for a period of five years. The judgment can be revived every 5 years to continue this lien. However, the judgment can continue to be executed upon past the 5 year period.

You may want to consider contacting the collection agency and working out some payment arrangement so that after the debt is paid, it will appear as a paid judgment on your credit report.

Terry P. Dershaw

Philadelphia Lawyer

http://www.phillylawyer.com

Re: how to deal with judgments

A judgment is a court determination that the creditor is owed the amount of the judgment. Also, in PA, interest accrues on the judgment at 6% per year.

A creditor can enforce the judgment in a number of ways. It can schedule an execution sale of the contents of your home. It can freeze your bank account while it is determined if the proceeds of the account must be given to the creditor. It cannot, however, attach your wages at this point in time. The PA legislature is talking about changing that law so that creditors will be able to do that, as well.

Under state law, you have little protection against enforcement of a money judgment. By contrast, a bankruptcy protects just about all consumer assets. There is an $8,000.00 wildcard exemption in any property you want. The contents of your home, if any one item is not worth a great deal, are exempt up to $8,000.00. There are many other exemptions, as well.

An exemption is a dollar amount assigned to an asset so that, if a Trustee ( the person charged with liquidating assets) were to attempt to sell such an asset, he would have to pay the exemption amount to you. Since the stated exemptions usually cover the value of the assets, most consumer cases are determined to be "no asset". Thus, you simply obtain a discharge of your debt.

If the creditor attempts to execute, it will obtain a lien on any property levied. That means that the debt will be discharged, but the creditor will maintain an interest in the levied assets. Your attorney would need to file a motion to avoid the lien because the same impairs your exemptions. If a bankruptcy were contemplated, you shoud file the same before execution. Since your credit is already harmed, a bankruptcy will not make it worse. To the contrary, it will actually improve it, because your debt-to-income ratio will be improved.

I suggest you speak with an attorney soon to avoid execution and obtain a fresh start as soon as possible.

I trust this has been helpful, but feel free to call or e-mail with further questions.