Winning a lawsuit can feel like crossing the finish line. But in many cases, the real work begins afterward by turning the judgment into actual dollars. Debtors may stall, hide assets, or even file bankruptcy. Creditors, meanwhile, must navigate a patchwork of state and federal rules to collect what they’re owed.

The Importance of Thinking Ahead

Too often, creditors wait until after trial to think about collectability. That’s a mistake. As Timothy Anzenberger of Adams and Reese LLP explains: “In an ideal world, I’d be thinking about executing on a judgment even before I file a lawsuit; I want an idea of what assets are out there so we can act quickly.”

Knowing whether a debtor is ‘judgment proof’ can prevent clients from wasting resources. For example, suing a business owner whose company is deeply underwater may only add legal fees to the losses. On the other hand, if the debtor owns real property or maintains active income streams, the prospect of recovery is higher.

Early asset evaluation may also justify prejudgment remedies. Many states allow plaintiffs to seek attachments or temporary liens to lock up property before trial. Creditors who act early often preserve assets that might otherwise disappear before judgment is entered.

Don’t Delay Enforcement

Once judgment is entered, the clock starts ticking. In many states, it’s a race among creditors. As Scott Bernstein of the Law Offices of Scott H. Bernstein LLC observes, “Once you have the judgment, it’s about who can collect first.”

This urgency underscores why creditors should line up enforcement tools like liens and garnishments before the ink dries on a judgment. Some jurisdictions impose short automatic stays, while others allow immediate enforcement. In New York, for example, a creditor can act right away unless the debtor posts an appeal bond. In Connecticut, however, a 30-day stay kicks in by default.

The creditor who records a lien or serves a bank garnishment first often gets priority. Here, diligence is essential; creditors who delay may find that others have already scooped up the available assets.

Finding the Money

The hardest part of the enforcement process is often locating assets. Bank accounts, real estate, and business interests don’t reveal themselves easily. Jeffrey Leon of Karon LLC advises that “You have to weigh how much collateral post-judgment litigation you’ll need in order to collect; sometimes the cost of chasing assets exceeds the value of the judgment.”

Fortunately, creditors have several options available to them for navigating this challenge, including:

• Post-judgment Discovery: This includes depositions, interrogatories, and document requests targeted at the debtor and third parties.
• Investigators: Firms that specialize in tracing hidden assets, especially offshore accounts or layered corporate structures.
• Corporate Analysis: Unraveling LLCs and partnerships can determine who actually holds valuable property.
• Public Records Searches: Real estate filings, UCC liens, and court dockets provide leads.
• Bankruptcy Schedules: If the debtor has filed for bankruptcy, these required disclosures can serve as an asset roadmap.

While over-investigating can drain resources, strategic searches can often uncover property debtors assumed would remain hidden.

Garnishments, Liens, and More

Once assets are identified, creditors must decide how to seize them. Enforcement tactics vary widely by state. For example, Florida’s broad homestead exemption shields a debtor’s primary residence from most creditors, no matter the home’s value. Mississippi, by contrast, allows wide use of garnishments, including for independent contractors.

Options for seizure include:

• Wage garnishment allows a portion of a debtor’s paycheck to be redirected to the creditor. Federal law caps garnishments at 25% of disposable income, but many states impose lower limits.
• Bank account garnishment lets creditors freeze and capture funds on deposit. Timing is key, however, as debtors may quickly move money once they suspect collection.
• Liens on real property create a claim against land or buildings. Filing in the county recorder’s office can secure priority against later creditors.
• Charging orders attach a debtor’s ownership interest in an LLC or partnership, diverting distributions to the creditor.
• Sheriff’s sales involve seizing and auctioning personal property, though these are less common in practice because debtors often settle before sale.

Keep in mind that not all property is collectible, and as with enforcement tactics, limits and restrictions vary by state. As Bernstein points out, “In New York, if a bank account has $3,000 or less, you can’t execute on it. In Pennsylvania, items like a family Bible, wedding ring, and clothing are exempt.”

Most states shield basic household goods and tools of trade. Federal law also protects retirement accounts like IRAs and 401(k)s. The goal is to ensure debtors retain a minimal standard of living. Creditors who ignore exemptions risk wasting resources or facing sanctions. For instance, attempting to levy exempt wages or benefits can trigger court penalties.

Pressure and Negotiation

While creditors may dream of repossessing cars or auctioning homes, many collections are resolved through negotiation. Enforcement proceedings serve as leverage here. Debtors confronted with garnishments or liens often agree to voluntary payment plans. These plans, if structured carefully, can provide a steady recovery without years of litigation. The key is balancing firmness with practicality. Payment plans should include acceleration clauses for missed payments and, ideally, some security such as a confessed judgment or collateral pledge.

Note that debtors sometimes attempt to stop collection with a bankruptcy filing. While the automatic stay halts enforcement, creditors still have rights. Filing timely proofs of claim, asserting lien positions, and reviewing schedules are essential. Creditors may also seek relief from the stay if assets are being dissipated. Moreover, guarantors, insurers, or jointly liable parties may remain fair game.

Avoiding Missteps

Enforcement carries risks, which is why precision is critical. If a debtor’s asset is impaired improperly and does their business harm, it could lead not only to sanctions but also to a lawsuit. In some cases, mistakes can cost more than the original judgment was worth.

Steven Reingold of Saul Ewing LLP underscores the pitfalls, recalling cases where creditors mistakenly filed liens on property not owned by the debtor. This can create ‘slander of title liability,’ meaning the property owner can sue for damages caused by the cloud on their title. Beyond financial penalties, these errors damage credibility in court and can sour settlement negotiations.

Some of the most common errors include:

• Filing liens against the wrong property: Debtors with common names may be confused with unrelated property owners. A misfiled lien can expose a creditor to damages and attorney’s fees.
• Miscalculating garnishment amounts: Federal law caps garnishments at 25% of disposable earnings, but many states impose lower thresholds. Failing to calculate correctly risks violating wage laws and can invalidate the garnishment.
• Overlooking competing liens or support orders: Child support and tax liens often have priority over judgment creditors. Ignoring them may mean wasted effort, since those claims will be satisfied first.

The bottom line: every enforcement action should be double-checked against statutes, local court rules, and the debtor’s actual ownership records. Accuracy protects both the creditor’s interests and the lawyer’s professional reputation.

Final Thoughts

Post-judgment enforcement requires caution, persistence, creativity, and an honest assessment of costs versus benefits. For creditors, the victory in court is just the beginning; the real challenge is making sure it pays off.

If contemplating enforcement action, remember to:

• Plan ahead: Evaluate collectability before litigation.
• Move fast: Delay lets debtors hide assets or other creditors win priority.
• Know the rules: Garnishments, liens, and exemptions differ by state.
• Balance costs: Don’t spend more chasing a judgment than it’s worth.
• Leverage pressure: Enforcement often leads to negotiated payment.
• Stay creative and persistent: Judgment collection is part law, part strategy, part detective work.