Using Judgement Liens to Collect On Judgments 

 Posted on November 26, 2024 in Debt Collection

Creditors who have received a court judgment against a debtor may sometimes find that the judgment is only the first step to collecting the debt. Unfortunately, that judgment does not guarantee that the creditor will receive payment. One of the tools to which creditors turn to enforce judgments is the judgment lien, which gives the creditor the right to force the sale of property owned by the debtor to collect on a judgment. In Illinois, an experienced creditors’ rights attorney can represent lenders to obtain judgment liens and collect on judgments.

How Can Judgment Liens Protect Creditors?

A judgment lien provides a way for creditors to obtain payment on an unpaid judgment by allowing creditors to force the sale of a property and use the proceeds from that sale to recover the unpaid judgment. It is not an automatic process. The creditor must file court documents in the appropriate country recorder as well as a copy with the Illinois circuit court clerk in the county in which the property is located.

On What Property Types Can Judgment Liens Be Placed?

Illinois allows judgment liens to "attach" or be placed on real estate only. Because Illinois has a homestead exemption, if the debtor is using the property as their primary residence, the creditor will not be able to force a sale on the home if the equity on the home is less than the debtor’s homestead exemption amount.

How Long Do Judgment Liens Last? 

A judgment lien will attach to the debtor’s property for a period of seven years. This lien remains on the property even if it changes hands during that time.

What is a Motion for Turnover?

A motion for turnover is a similar alternative to the judgment lien, whereby a creditor can petition the court to have the sheriff sell the property without obtaining a lien. This can avoid the cost of obtaining a lien. However, the equity interest (meaning the difference between the home’s value and the amount owed on the home) must be greater than the judgment debt.

When is a Judgment Lien Not the Best Option for Creditors?

In some cases, attempting to foreclose on a judgment lien may not be the best option for a creditor, such as when:

• The Homestead exemption applies and the equity is less than the exemption amount.

• The sale price is likely to be below market value, leaving little left to pay the judgment after fees.

• There are several secured creditors ahead in line to get paid because judgment liens are a lower priority than other types of liens. Priority is the term that describes in what order creditors get paid if a debtor’s property is sold.

Contact a Chicago, IL Judgment Enforcement Attorney 

With over 40 years of experience helping lenders collect on debts, the attorneys at Dimand Walinski Law Offices, P.C. can work alongside you to ensure you are paid for the judgments you have obtained in court. The knowledgeable Cook County, IL debt collection attorneys can provide legal advice and representation to let you know whether a judgment lien is a good option for you to enforce an unpaid judgment. Call 312-704-0771 today for a consultation.