Texas is a state that is favorable to debtors when it comes to a creditor trying to collect a judgment. It is unconstitutional to garnish wages in Texas, and a person’s home and vehicles are usually beyond reach. Unless a judgment debtor has a going business with valuable inventory or cash flow, rental property, or cash in the bank, collecting on a judgment is going to be problematic.
Sec. 41.001(5)(c) that “The homestead claimant’s proceeds of a sale of a homestead are not subject to seizure for a creditor’s claim for six months after the date of sale.” This expressly permits homestead protections to be rolled over from one homestead to the next
Certain personal property is also exempt under Chapter 42 of the Property Code. Personal property valued at $60,000 for a family or $30,000 for a single adult (exclusive of liens) is exempt from garnishment, attachment, execution or other seizure so long as it is on the following list:
(1) home furnishings, including family heirlooms; (2) provisions for consumption; (3) farming or ranching vehicles and implements; (4) tools, equipment, books, and apparatus, including boats and motor vehicles used in a trade or profession; (5) wearing apparel; (6) jewelry not to exceed 25 percent of the aggregate limitations prescribed by Section 42.001(a); (7) two firearms; (8) athletic and sporting equipment, including bicycles; (9) a two-wheeled, three-wheeled, or four-wheeled, motor vehicle for each member of a family or single adult who holds a driver’s license or who does not hold a driver’s license but who relies on another person to operate the vehicle for the benefit of the non licensed person; (10) the following animals and forage on hand for their consumption: (A) Two horses, mules, or donkeys and a saddle, blanket, and bridle for each; (B) 12 head of cattle; (C) 60 head of other types of livestock; and (D) 120 fowl; and (11) household pets.
Retirement plans (IRA’s and 401k’s) are exempted under Sec. 42.0021 so long as contributions do not exceed the amount that is deductible under current law. Rollover proceeds are exempt for sixty days.
A creditor CAN try to collect the judgment by requesting that you answer interrogatories (written questions that you must answer under oath) and/or a deposition ( an oral question and answer performed by the creditor with a court reporter present. Your answers are under oath.
But, if you don't have anything that can be collected, then the judgment can't be collected.
It is normal that the coeditor for the creditor to request an abstract of judgment
from the clerk and then file the abstract in the real property records (judgment records and real property records are often found in different computers). It stays on file for 10 years, but may be re-filed. Filing such an abstract puts the public on notice that the judgment exists and attaches to real property of the debtor. Therefore, if you try to sell your property, the lien for the amount of the debt may have to be paid to clear the title
And, until you pay the judgment, a "negative" will appear on your credit reports
. Once the judgment is paid, then the creditor needs to file a Satisfaction of Judgment
with the court. You should be sent a copy of the Satisfaction. Then, you should make a copy and send it to the credit reporting agencies so that the judgment will show that it is paid. You should follow up with the credit reporting agencies to make sure that the reports reflect that you paid the judgment.
But....in the end, if you don't have a bank account, then monies can't be taken from it to pay the judgment. If your wages are put directly into a pre-paid credit card, your money should be protected. Remember, any wages CANNOT be garnished!
You always have the opportunity to contact an attorney who specializes in debtor/creditor law. You can discuss the specific facts of your case, evaluate your options and decide if you need to do anything different than you are doing now.
I hope you find this information useful.
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