Understanding the Limitations of Bankruptcy in Judgment Collection
When you’ve obtained a judgment against a debtor, the next step is often figuring out how to collect on that judgment. While bankruptcy may seem like a way for the debtor to escape, as a creditor, it’s essential to know how bankruptcy affects your ability to collect. Having over 25 years of experience as a debtor’s attorney in bankruptcy and handling over 4,000 Chapter 7 and 13 cases, I understand the dynamics of both debtor and creditor situations.
The Limitations of Bankruptcy for Judgment Collection
Bankruptcy may be seen as a way for debtors to discharge their debts, but it doesn’t automatically protect you as a creditor from collecting on a judgment. While certain debts may be discharged, others—especially those related to a judgment against the debtor—are not.
Writs of Garnishment: A Powerful Tool
In many cases, once you have a judgment, one of the most effective ways to collect is through writs of garnishment. This legal tool allows you to seize funds directly from the debtor’s bank accounts or wages. With over 25 years of experience in bankruptcy law, I am well-versed in how writs of garnishment work, especially in Texas, where there are specific rules and exemptions.
Understanding Texas Exemptions and the Process
Texas exemptions play a crucial role in determining how much of the debtor’s assets can be seized. In many cases, certain property is protected, but a skilled creditor’s attorney knows how to navigate these exemptions to maximize collection. As a seasoned professional, I am familiar with the ins and outs of the Texas Justice Court system, and how judgments can be enforced through garnishment despite the debtor’s bankruptcy status.
The Role of the Justice Court in Garnishment
Texas Justice Courts play a pivotal role in the garnishment process. If a debtor is attempting to hide assets, these courts can help enforce your judgment by issuing orders to garnish bank accounts or wages. Understanding how these courts function and working closely with them can make a significant difference in whether you successfully collect what is owed.
Conclusion: Navigating Judgment Collection
While bankruptcy may provide debtors with a fresh start, it doesn’t necessarily shield them from your collection efforts as a creditor. With the right legal strategies, including writs of garnishment, and an understanding of Texas law, you can successfully enforce your judgment. If you’re facing challenges in collecting from a debtor who has filed for bankruptcy, consulting with an attorney who understands the collection process and bankruptcy law is crucial.
