A standard piece of advice we offer companies struggling to collect judgments is to bring in a collection agency, like Judgment Collectors, as early in the process as possible. The sooner, the better. There are multiple reasons for this. One such reason is the need to search for hidden assets.
It is not unusual for judgment debtors to be less than forthcoming about their assets. That being the case, one of the first things we start working on is finding said assets. Sometimes the task is fairly easy. But in most cases, it is not. Finding hidden assets takes time and effort. That’s why we suggest getting involved as soon as possible.
Up Against the Clock
No matter who manages collecting an outstanding judgment, the people who do the actual work are up against the clock. We say that for a couple of reasons. First is the fact that time is the enemy. The longer it takes to collect, the harder collection actually becomes. Judgment debtors use time to their advantage. They know that delaying for as long as possible increases their chances of never having to pay. That leads us to the second issue.
Judgment enforcement is subject to a statute of limitations. Although one state differs from the next, the average statute of limitations is 7-10 years. That might seem like a lot of time, but it’s really not. The years can pass rather quickly when a creditor gets bogged down in a case that proves itself difficult to navigate.
Bringing a collection agency in early allows that agency to start looking for assets right away. The sooner those assets can be found, the sooner they can be leveraged to get the judgment settled. But the opposite is also true. The longer it takes, the less leverage a judgment creditor has.
Using Every Tool at Our Disposal
Those of us who specialize in collecting judgments have access to a variety of tools that are only available to us because a judgment has been entered. We will not get into the tools in detail. However, we will say that we use every tool at our disposal to find investment properties, vacation properties, collectibles, and any other assets that might provide a path forward to successful collection.
Here is just one example from our own case files:
We once took a case on behalf of a client who was struggling to collect from a debtor who claimed to have no assets. Through a search of property records and other resources, we eventually discovered that the debtor owned an airplane hangar in a neighboring county. Armed with that knowledge, we contacted the debtor.
The fact that we knew of his assets was all the motivation he needed to make good on his debt. But if we had not found the airplane hangar, there is the possibility that our client would still be trying to get paid. Without knowledge of that asset, there was little else to go on.
Assets Are the Key
One could make the case that, when debtors do not agree to voluntary payment plans, assets are the key to successful collections. But finding assets debtors are trying to hide takes time and effort. Debtors can be quite clever in how they hide assets. We need to be just as clever in our efforts to find them.
We are firm believers of bringing in a collection agency as early in the process as possible. Collection agencies need time to do what they do, especially when looking for hidden assets that are part of the deal.