It is common knowledge that creditors and judgment collectors can initiate proceedings to seize personal property as a last resort enforcement option. However, asset seizure is tricky business. It is tricky because the laws governing what can and cannot be seized differ from one state to the next.
Judgment Collectors operates in multiple states. As such, it’s not possible for us to provide a static list of assets you could and could not seize to collect an outstanding judgment. That said, there are a number of assets that are off limits in a good number of states. A few of them are listed below. As you read, please bear in mind that the laws in your state might be different. What you read here constitutes a general guideline.
As a general rule, Social Security payments are protected from asset seizure. This includes monthly retirement payments, disability payments, and survivor’s benefits paid to the spouses and children of deceased Social Security recipients.
Social Security payments cannot be seized or garnished because they are considered necessary income. The income is not ‘extra’, per se. It is vital income similar to child support payments and spousal maintenance.
Like Social Security payments, unemployment benefits are considered vital income. People receiving such benefits do not have jobs. They are not taking in regular income from an employer. Therefore, what they receive in unemployment benefits is designed to meet basic necessities.
Most states do not allow the seizure and sale of a debtor’s primary residence – with the exception of foreclosure. But foreclosure is a separate entity. In terms of civil judgments, primary residences are off limits. For the record, the prohibition is not limited to single family homes. It applies to any dwelling.
That means a primary residence existing as a condominium, town home, or even motor home is off limits. The idea here is simple: seizing a debtor’s primary residence would make that person homeless. Most states simply will not tolerate it.
In addition to a person’s primary residence, any goods within that residence considered necessary cannot be seized and sold. This includes things like appliances, tools, furnishings, clothing, and personal effects. Note that some states do allow seizure of certain types of household goods up to a certain value. That’s something you would have to inquire about in your state.
Some states exempt a debtor’s primary vehicle from asset seizure under the belief of that it is necessary to protect the individual’s right to continue working in earning a living. Almost all states exempt specially equipped vehicles designed to accommodate a disability.
For example, a handicapped individual with a specially equipped wheelchair-accessible van could claim that van as exempt from seizure. A judgment creditor could not go after it regardless of its value.
Again, all these exemptions are offered as general guidelines. State laws relating to both civil judgments and enforcement can vary quite a bit. This is why it’s so important to consult with an attorney before, during, and after a civil case. The law can be extremely complicated when it comes to these matters.
As judgment collection experts, we are committed to working on behalf of our clients consistent with what the law says while still using every tool at our disposal to procure payment. if you would like to know more about how Judgment Collectors can help you, please reach out to us.
Published March 21, 2023