brian1660

Received copy of Affadavit for Renewal of 5-yr old Judgement in AZ

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In today's mail from a lawyer was a copy of an Affidavit for Renewal of Judgement which was originally entered in Maricopa County Superior Court 12/7/12 from an old $2500 credit card debt.

 I tried to settle unsuccessfully with the attorney  subsequently missed the court date so a default Judgement was entered. 

I was thinking that time heals all wounds and patiently have waited for the  Judgement to expire or drop off.

My credit has been wrecked for a long time and was just starting to improve.  Is this going to follow me forever?  Is there no Statue of Limitations that applies? What should I do?

 

 

 

 

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1 hour ago, brian1660 said:

In today's mail from a lawyer was a copy of an Affidavit for Renewal of Judgement which was originally entered in Maricopa County Superior Court 12/7/12 from an old $2500 credit card debt.

 I tried to settle unsuccessfully with the attorney  subsequently missed the court date so a default Judgement was entered. 

I was thinking that time heals all wounds and patiently have waited for the  Judgement to expire or drop off.

My credit has been wrecked for 6 years and was just starting to improve.  Is this going to follow me forever?  Is there no Statue of Limitations that applies? What should I do?

 

 

 

 

AZ law allows the renewal of judgment within 5 years from the date it was filed. Unless the law says otherwise, they can renew it every 5 years.

Calling @Harry Seaward or @Goody_Ouchless

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Indeed, judgments can indefinitely be renewed every 5 years in AZ.

http://www.guywbluff.com/areas-of-practice/collections/arizona-judgments-expiration-practice-and-procedure-for-renewal

Just FYI in terms of credit reporting, the collection account is separate from the judgment.  While it seems the judgment can be reported as long as it's being renewed, the collection account must be removed at 7 years.   Judgments seem to not be as damaging to a credit score (especially when they get a year or so in) as the original collection accounts so you have that going for you.  Having said that, some creditors won't even look at you if you have a public record judgment on your report no matter what your score is.

Honestly though, you're the first one I've had come back to report a judgment creditor renewing their judgment.  I just figured debt collectors just let them expire at 5 years.  Not sure if you're just unlucky or if you're on the forefront of things we should expect to see coming down the road.

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Thank you for your input. 

I guess the choices are to pay it, fight it or ignore it . I feel the amount they seek is exorbitant and I talked to them about settling  5 years ago but all they offered was a payment plan. 

If the meter keeps running, in 5 more years the amount will probably be $15-$20K and I worry whether they can go after my house. There is no mortgage.   I am 57 now and operate a small, cash only service business.

can i contest the renewal of the Judgement or is fighting an option?  If they have the Judgement then what recourse do I have? Do I have to take equity out of my house to pay them in order to avoid losing my home or should I continue to ignore and go on living "underground" 5 more years or perhaps forever?

Thank you again, Brian.

 

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3 hours ago, brian1660 said:

can i contest the renewal of the Judgement or is fighting an option?

No.  The time to fight was when they sued.  Failing to show for court or appeal was fatal to fighting it now.  

3 hours ago, brian1660 said:

If they have the Judgement then what recourse do I have?

Pay it, ignore it, or file bankruptcy.  Paying it does not necessarily mean paying the full amount. You can make a settlement offer of a lump sum one time cash payment that settles the account in full.  You can keep negotiating until you both reach a number you can agree on.  What every you agree to do NOT pay until you have all the terms in writing.  

3 hours ago, brian1660 said:

Do I have to take equity out of my house to pay them in order to avoid losing my home or should I continue to ignore and go on living "underground" 5 more years or perhaps forever?

I would figure out what lump sum settlement they will take to get rid of it.  It would not be worth risking the possible forced foreclosure over an old judgment.  If you are not looking to leave the home to heirs a reverse mortgage could help considerably.  I do not know much about them but it might be better than a home equity loan.  Check into both.

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Thank you. It's good to know they wouldn't have a claim to my home.  I think my home is protected in a BK as well. 

So I can attempt to settle but they seem to expect all of it.  That is an assumption though based on my earlier try.  

My credit has recovered somewhat.  It may take another hit when the renewal of the Judgement is recorded but I don't care of my credit is perfect.

I just don't want to be taken advantage of by this attorney.  He is not the OC so I can't justify paying that ambulance-chasing buzzard 4 times the original debt.

If I can't settle for a reasonable amount , say 35%, then I will file BK or ignore it.  

If he can't take my house then what can he do to me?  Will he get it from my estate when I die?

What is the impact on me in the short term?  If all they can do is damage my credit then  I don't feel much urgency. 

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24 minutes ago, brian1660 said:

If he can't take my house then what can he do to me?  Will he get it from my estate when I die?

What is the impact on me in the short term?  If all they can do is damage my credit then  I don't feel much urgency.

 They can garnish wages, levy bank accounts, put liens on personal property and, although rare, show up at your house and start seizing items to satisfy the judgment. If you are self employed and deal in cash, you're more or less what's known as "judgment proof". They might still be able to put liens on your vehicle titles but if they haven't done it yet, I doubt they will. Same goes for coming to your house to seize your property. In any case, they have to go through the court to exercise any of these options so you'll have notice before it happens and all of their attempts come to a halt once you start BK proceedings. 

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Sounds a little threatening all the things they can do.  Probably rather live with a BK and the 2-yr credit restoration process than ignoring the problem and living "off the grid" forever. 

With regards to settling,  I have zero confidence they would settle for anything close to the cost of a BK but I could inquire.

I started a BK five years ago but figured I could wait till the judgement went away.   Since I am working a small cash business out of my pocket I haven't even filed tax returns for several years so BK would have meant doing all those past years' returns.. 

Does BK necessarily require spending a ton of cash on a BK lawyer ?  I say a ton cuz 2000 lbs is a ton and $2000 is a ton of cash I think.  lol

 

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7 hours ago, brian1660 said:

Does BK necessarily require spending a ton of cash on a BK lawyer ?

If you don't have a bunch of unusual circumstances (8 houses, 12 cars, lots of antiques etc) you should be fine doing the BK by yourself. 

Your tax returns have to be logical and jive with whatever you file in your BK. Meaning you can't claim $10k/year income with the IRS and then claim $40/year expenses with BK court. And if you plan to claim business expenses, you'll need records because showing up on the IRS radar after 5 years of radio silence, and cash transactions as your sole source of income is an IRS auditors wet dream.  I'm now more concerned about your potential tax liability than the debt judgment.  You can't BK tax liability away so that's something I would definitely run by a tax lawyer or accountant before I filed a single sheet of paper in BK court. 

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Appreciate that piece of advice.

I have kept most of the necessary records.  But that's a good point.  I need to make sure I file some coherent returns.  

I don't believe I will have a problem with the previous years returns. 

My income has been a joke and anyway its been cash only except for one W-2 part-time job in last 7 years so I haven't had much income to report since about 2007 .

I don't think I could have much in the way of a tax liability but I better follow your advice and see where I stand..     

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