canIavoidajudgement?

[indebtnodoubt]

What is the name of your state? AZ
What is the name of your state? Arizona

I need some advice... I took out a loan from my credit union for about $4500 and made payments until I had a loss of income and I couldnt afford to make payments. I thought that I would have 6 months to pay in order to keep my account there, but unlike credit cards, they sent my account out to an attorney after 3 months of non-payment. I called the lawyer once i knew that he was handling it and wanted to make payment arrangments but they said when they take me to court the payment arrangements can be made. I mailed payments to the lawyer for a couple months even though they assured me I would be served papers any day. After a two months of waiting for something from them and not sending payments, ( bec. I want to settle my acct since it is already a r9 on my bureau) I finally recieved a summons that was given to me by a process server bec. they were apparently unable to reach me any other way.I have no problem paying but I have no idea what to do at this point. I am a young college student and I am afraid those lawyers will "eat me alive" in the courtroom. I also have a car I am making payments on and I am afraid they will take my car? will they do that even if im willing to pay? please help me!

 

[jherentals]

caniavoidajudgment

Your situation is a lot like mine. They cannot take your car whether you make payment on it or not, as long as it's not some 2005 Hummer you own outright. Once they have a judgment, there is a limit on how much they can take...most states say 25per cent of your wages. If they're not willing to work with you, then make it hard for them to collect. You can always file bankrutpcy, but a 4500 judgment is not a huge amount, although your credit is trashed now anyway, but that may be an option to get them outa your life once and for all. My email is jherentals@yahoo.com please please please feel free to contact me directly. I may have some other suggestions once I understand your situation more. best wishes Jim

 

[jherentals]

Your situation is a lot like mine. They cannot take your car whether you make payment on it or not, as long as it's not some 2005 Hummer you own outright. Once they have a judgment, there is a limit on how much they can take...most states say 25per cent of your wages. If they're not willing to work with you, then make it hard for them to collect. You can always file bankrutpcy, but a 4500 judgment is not a huge amount, although your credit is trashed now anyway, but that may be an option to get them outa your life once and for all. My email is jherentals@yahoo.com please please please feel free to contact me directly. I may have some other suggestions once I understand your situation more. best wishes Jim

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[indebtnodoubt]

action now?

Thanks for the reply. But ? is what do I do now? Get a lawyer and go to court? Should I call the lawyer who is litigatitng against me and try to see if he'll accept payment arrangments or is it too late? Do I need to type a reply to the summons(the one they sent is stamped/dated a couple months ago, but I just got it a few days ago?)?

 

[bulldogg70]

Look he needs in order in hand so that he can start garnishment and other such activities, that is why he is going throught his process. Now, and just to point out, an attorney cannot decide if he is or is not going to go after you because you own a hummer or not. However, in Az he can record a lien against your car, house, property, etc inorder to provent you from selling those items before clearing your debt. There are other things he/she can do, but realistically, read up on your debt at the ASU library and see what your options are, although limited, and attempt to broker a deal with the lawyer, which will probably come after a judgement is made

 

[ihatearizona]

However, in Az he can record a lien against your car, house, property, etc inorder to provent you from selling those items before clearing your debt.

Not entirely correct, AZ has very generous exemptions when it comes to judgments.

You are allowed up to $150,000 in equity on your home.
You are allowed up to $5,000 in equity on your car.

I'd advice going to the court date to see if the judge will try to let you work out payments, but even that may not stop the judgment. Make sure you file paperwork with the court to protect your exemptions.

A judgment in AZ is good for five years, but renewable every five years, meaning it can last forever.

 

[bulldogg70]

That statement is true, however if you record a lien against one of those properties, a title company will not procede with the transfer of deed or title. It is a standard practice of lawyer to record a judgement so they can stop a sale without them getting paid.

 

[ihatearizona]

FYI:

33-964. Lien of judgment; duration; exemption of homestead; acknowledgment of satisfaction by judgment creditor

A. Except as provided in sections 33-729 and 33-730, from and after the time of recording as provided in section 33-961, a judgment shall become a lien for a period of five years from the date it is given, on all real property of the judgment debtor except real property exempt from execution, including homestead property, in the county where the judgment is recorded, whether the property is then owned by the judgment debtor or is later acquired. A judgment lien for support, as defined in section 25-500, and associated costs and attorney fees remains in effect until satisfied or lifted.

B. A recorded judgment shall not become a lien upon any homestead property. Any person entitled to a homestead on real property as provided by law holds the homestead property free and clear of the judgment lien.

C. A judgment of the justice court, municipal court, superior court or United States court which has become a lien under this article, shall, immediately on the payment or satisfaction of the judgment, be discharged of record by the judgment creditor or the judgment creditor's attorney by recording a satisfaction of judgment with the county recorder of the county in which the judgment is recorded. The judgment creditor or the judgment creditor's attorney shall enter a notation of satisfaction on the docket of the clerk of the superior court of each county where the judgment has been entered or docketed, and in a like manner enter a notation of satisfaction on the docket of the clerk of the United States district court.

 

[bulldogg70]

You have it correct again, however there are two things here. First, if the house is greater in value than the 150k you have an opportunity to file a lien, and again the issue here is a title company will not touch the property with a lien. Further a homestead would have to be declared, a person putting that lien on the property would not know "initially" if was declared or not. This would mean that you would have to go back to the person that has a lien againt you and ask them to remove it or go to court and seek relief. During this whole time yo uare aware of what is going on. You now have an opportunity to bring that order claim to the court and seek relief. When you record Lis Pendens on a property it would cause problems and issues. I understand the homestead, and you are not being forced out of your house for the balance of the house, which the homestead protects. However, if you do not believe how common this action is, just go down to the Recorder or their website and you will see them all over they place.

 

[ihatearizona]

Declaration of Homestead is automatic in AZ. No paperwork is required.

Back in the mid-nineties, there was a big scam going on with companies that were charging people big bucks to send them info on how to fill out and record the declaration. The legislature recognized the scam and made all homesteads automatic. I think this took place in 95 or 96.

 

[bulldogg70]

I reviewed the history on that. However, I am lost on the automatic assumption of Homestead. How is it assumed if you own more than one property or interest, you only get homestead on one property??? Anyway, not knocking it but in my real estate "real property" law class, our instructionors, which of course are attorneys, mentioned this is tactic almost always used in an effort to ensure a greater chance in receiving relief from the other party.

 

[ihatearizona]

The homestead only applies to the home that is being occupied by the owners. This would exclude all secondary properties.

I agree with your professor that collection agencies use this tactic. That does NOT make it legal though.

Check this out, I just found this today:

33-420. False documents; liability; special action; damages; violation; classification

A. A person purporting to claim an interest in, or a lien or encumbrance against, real property, who causes a document asserting such claim to be recorded in the office of the county recorder, knowing or having reason to know that the document is forged, groundless, contains a material misstatement or false claim or is otherwise invalid is liable to the owner or beneficial title holder of the real property for the sum of not less than five thousand dollars, or for treble the actual damages caused by the recording, whichever is greater, and reasonable attorney fees and costs of the action.

B. The owner or beneficial title holder of the real property may bring an action pursuant to this section in the superior court in the county in which the real property is located for such relief as is required to immediately clear title to the real property as provided for in the rules of procedure for special actions. This special action may be brought based on the ground that the lien is forged, groundless, contains a material misstatement or false claim or is otherwise invalid. The owner or beneficial title holder may bring a separate special action to clear title to the real property or join such action with an action for damages as described in this section. In either case, the owner or beneficial title holder may recover reasonable attorney fees and costs of the action if he prevails.

C. A person who is named in a document which purports to create an interest in, or a lien or encumbrance against, real property and who knows that the document is forged, groundless, contains a material misstatement or false claim or is otherwise invalid shall be liable to the owner or title holder for the sum of not less than one thousand dollars, or for treble actual damages, whichever is greater, and reasonable attorney fees and costs as provided in this section, if he wilfully refuses to release or correct such document of record within twenty days from the date of a written request from the owner or beneficial title holder of the real property.

D. A document purporting to create an interest in, or a lien or encumbrance against, real property not authorized by statute, judgment or other specific legal authority is presumed to be groundless and invalid.

E. A person purporting to claim an interest in, or a lien or encumbrance against, real property, who causes a document asserting such claim to be recorded in the office of the county recorder, knowing or having reason to know that the document is forged, groundless, contains a material misstatement or false claim or is otherwise invalid is guilty of a class 1 misdemeanor.