2023 Rule Changes Make Judgment Collection Harder in Kentucky

As you undoubtedly know, obtaining a money judgment and collecting it are two separate things. Obtaining is generally the easier of the two tasks. Collecting is much harder due to legal standards that limit a judgment creditor’s actions. Such is the case in Kentucky, where changes enacted last year have made judgment collection in the state harder than it has ever been before.

Kentucky lawmakers passed House Bill 83, a bill that constituted the first changes to the state’s judgment lien statute in 35 years. It was signed into law on April 6 and went into effect on June 29, 2023.

Below is a brief discussion of the three most important changes attributed to the legislation. As you read, bear in mind that Judgment Collectors is active in Kentucky. If you are trying to collect a money judgment in the Bluegrass State, we might be able to help.

Change #1: A Reduced Statute of Limitations

Most states impose a statute of limitations on enforcing judgments. Where money judgments are concerned, this effectively means limiting the amount of time a judgment creditor has to collect. The average is 7-10 years. Prior to last year’s legislation, the statute of limitations for judgment collection in Kentucky was 15 years. It has been reduced to 10.

A decade may seem like a lot of time to collect a judgment, but it is really not. When a judgment debtor either has limited resources or fails to cooperate with collection efforts, certain actions need to be taken. Those actions consume precious time. Continuing to work on collection for years after the original decision is not unusual.

In Kentucky’s case, the statute of limitations has been reduced by about one-third. It is a pretty significant change. However, the next change is even more important.

Change #2: Unlimited Renewals Eliminated

What happens if a judgment creditor is unable to collect within the original statute of limitations? Most states allow judgment renewal. Kentucky certainly does. However, prior to last year’s rule changes, judgment creditors were afforded unlimited opportunities to renew. That is no more.

Judgment creditors are now limited to a single renewal. In addition, the renewal period isn’t 10 years. It is 5 years. This particular change is critically important because it gives judgment debtors motivation to stall for as long as possible. A single renewal at just 5 years is far from ideal. Nonetheless, it is now the law in Kentucky.

Change #3: New Post-Limitation Filing

The third change is more administrative than anything else. It requires judgment creditors wishing to continue pursuing collection efforts that are pending at the time the statute of limitations is reached to file a new notice with the court. That notice is known as a Notice of Judgment Lien Enforcement Preceding. It must be filed in the same county in which the judgment lien is recorded.

Again, this change is merely administrative. However, it does place yet another burden on judgment creditors and their attorneys. Failing to file the notice means giving up on collection efforts that are pending when a judgment expires.

Perhaps We Can Help

Judgment Collectors is here to help collect monetary judgments in Kentucky. Contact us and let us know exactly what you are working on. We will take a look at your case before determining the best strategy for moving forward.

You should know that we work on consignment. We cover all our own costs and don’t get paid until, and if, we collect. Turning your Kentucky judgment over to us means not spending another dime or a minute of your time trying to collect.