The Texas Judgment Lien Is A Forgotten But Powerful Collection Tool
While Texas is definitely among the most difficult states in which to collect a money judgment, it is certainly not impossible. There are tools, methods, and procedures in place that permits an aggressive plaintiff to successfully collect the money that the court awarded. Nevertheless, lots of plaintiffs completely overlook the most basic collection instrument offered in Texas - the judgment lien.
The very first task you ought to do soon after the judge signs the order awarding you any amount of money from the defendant is to make sure you secure your judgment lien.
What is a Judgment Lien?
A lien is nothing more than a charge against property to secure payment of a debt. It literally links a liability to real estate. From there on, whenever that property is sold the attached interest must be paid. Normally, it is repaid from the money changing hands in the sale of the property.
Your court order awarding you a certain amount of money is a debt than can generate a lien on the property of your debtor. On the other hand, the fact that you possess a judicial order does not, by itself, produce a lien on real estate belong to your debtor. An automatic security interest would certainly be nice. However, that is not how the game is played in Texas. You must prepare and file an abstract of judgment in the county records to effectively create a lien against real property in Texas.
What is an Abstract of Judgment?
An abstract of judgment is not necessarily a complicated or intricate legal form. It is just a written summary of how much the losing party in a legal action is obligated to repay the winning party in the lawsuit. On the other hand, the summary should be properly prepared to effectively produce a lien.
When your order comes out of a small claims court or a justice court, the magistrate of that court must prepare the summary for you. You can not prepare your own abstract in those suits. But, if your court order is out of any other state court, you may prepare the summary yourself or have your attorney do it for you. Even though there is no basic - fill in the blanks -type of form for abstracts in Texas, there are certain bits of information which must definitely be in the summary for it to be legally effective.
How to File to Create Lien?
Once you have a properly prepared abstract, you ought to take it to the county clerk for filing and recording. You do not have to employ an attorney to accomplish this for you. You can just take the document to the county clerk yourself. The clerk indexes it in an alphabetical index of records. The act of indexing is what actually creates your lien. So, it is essential that you verify the abstract is properly recorded and indexed.
If the debtor posseses any real property in the county in which you indexed the abstract, your lien fastens to that property. The only exception to this rule is the debtor's homestead property. The homestead is exempt from a judicial lien in Texas.
How Long Does a Judgment Lien Last?
Once you create the lien, it lasts for ten years. You can. however, keep both the court order and the secured interest alive longer than 10 years.
About the Author
Harvey L. Cox founded the Texas Judgment Collection Center at http://texasjudgmentcollection.com as a resource to help Texas judgment creditors collect their money judgments. He is also the author of "How to Collect Your Own Judgment in Texas."
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