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What Does Judgment Proof Mean?

Q: What does it mean to be judgement proof, and how do I know if I am? Thank you.

– Betty

Reply from

Great question Betty! Being judgment proof essentially means that you don’t own any property that could be seized or attached by creditors. If you were sued, the creditor or collector might successfully get a judgment against you, but wouldn’t really be able to go after your bank account or other property to get paid right away. (“Property” here doesn’t mean just a home, but may include wages, a car, or other things you own.)

Being judgment proof doesn’t mean you can’t be sued. Sometimes creditors will sue in order to get a judgment so they can try to collect in the future. In most states, judgments last a long time and can be renewed.

If it turns out you are judgment proof and you let the creditor or collector know that, they may decide it’s not worth incurring the expense of taking you to court. They may back off and give up on trying to collect your debt. The statute of limitations may then expire on the debt, so even if they tried to collect at a future date, they may not be able to do so.

The best way to find out if you are judgment proof is to set up a a free consultation with a bankruptcy attorney in your state. The bankruptcy attorney can review your financial situation and tell you whether property you own is safe.

If it turns out you are judgment proof, then you may want to send the debt collectors who are contacting you a cease and desist letter explaining your situation. Once they receive that letter, they can’t contact you again except to acknowledge your letter or to let you know they are taking legal action against you. But, again, if you’ve told them you’ve met with a bankruptcy attorney and you are judgment proof, they may decide it’s not worth the time or expense to pursue you for the debt. We can’t guarantee that, but they usually don’t want to throw good money after bad either.

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