When a defendant doesn’t pay a small claims judgment, consequences vary from seizure of personal property to jail time. The judgment creditor must ensure the debt is collected before each state’s mandated deadline.
Consequences for Not Paying a Small Claims Judgment
If a judgment debtor refuses or otherwise fails to pay a small claims judgment, penalties include:
- Seizure of personal property
- Garnishment of assets and/or wages
- Debt increases over time due to interest
- Negative impact on credit report
- Debt reported on background check
- Jail time
How Can the Judgment Debtor be Forced to Pay?
In the best case scenario, the defendant pays their debt promptly after the judgment is issued. If they don’t, there are a variety of options available for collecting the debt.
Garnish Wages
If you know the judgment debtor’s employer, you can attempt to collect a judgment by garnishing their wages. In most states, those who depend on social security payments, retirement benefits, and earnings below the poverty level are exempt from garnishment.
Typically, the process requires filing a request for garnishment with the court. If approved, the judge will issue an order to the judgment debtor’s employer requiring them to reserve a portion of the wages to pay the debt.
Garnish Bank Funds
If you know that the judgment debtor has enough funds in a bank account, you can collect a judgment by seeking a bank garnishment. In many courts, the process starts by filing a writ of garnishment form with the court clerk. If approved, the judge will issue an order to the judgment debtor’s bank requiring them to freeze a portion of the account to pay the debt.
Seize Property
You can request that the judgment debtor’s personal property is seized to pay the debt. Typically, the process requires filing a writ of execution with the local court, sheriff, or other law enforcement officer. If approved, the court-appointed officer will serve the judgment debtor and seize their property. Once seized, the property will be auctioned off to pay the debt.
Impose a Real Estate Lien
If you obtain a real estate lien, proceeds from the sale of the property will be used to pay the debt. The process to obtain a real estate lien varies by state. Typically, the process includes filing a request with the court clerk or recording the judgment with the county recorder where the property is located.
How Long is a Small Claims Judgment Active?
Judgments must be collected within a certain period of time after they are issued. If the judgment has not been collected during that time, it expires and is no longer active.
The deadline is typically 5 to 10 years depending on the state. However, judgments gain annual interest so defendants are motivated to pay as quickly as possible.
| State | Judgment Deadline | Annual Interest |
|---|---|---|
| Alabama | 10 years | 7.5% |
| Alaska | 5 years | 7.5% (in 2023) |
| Arizona | 10 years | 1% + Prime Rate or 10% (whichever is less) |
| Arkansas | 10 years | 2% + Federal Reserve Primary Credit Rate |
| California | 10 years | 10% |
| Colorado | 6 years | 8% |
| Connecticut | 10 years | Determined by Court |
| Delaware | 10 years | 5% + Federal Reserve Discount Rate |
| Florida | 20 years | Changes Quarterly |
| Georgia | 7 years | 3% + Prime Rate |
| Hawaii | 10 years | 10% |
| Idaho | 10 years | 10.25% (until July 2024) |
| Illinois | 7 years | 9% |
| Indiana | 20 years | 8% |
| Iowa | 20 years | 6.78% (in 2023) |
| Kansas | 5 years | 12% |
| Kentucky | 15 years | 6% |
| Louisiana | 10 years | 6.5% (in 2023) |
| Maine | 10 years | 10.73% (in 2023) |
| Maryland | 12 years | 10% (6% on unpaid rent) |
| Massachusetts | 20 years | 12% |
| Michigan | 6 years | Changes Biannually |
| Minnesota | 10 years | 5% (in 2023) |
| Mississippi | 7 years | Determined by Court |
| Missouri | 10 years | 9% |
| Montana | 10 years | 3% + Bank Prime Rate |
| Nebraska | 5 years | 6.9% |
| Nevada | 6 years | Changes Biannually |
| New Hampshire | 20 years | 5.8% (in 2023) |
| New Jersey | 20 years | 0.25% (in 2023) |
| New Mexico | 14 years | 8.75% (15% if the act was in bad faith) |
| New York | 20 years | 9% |
| North Carolina | 10 years | 8% |
| North Dakota | 20 years | 10% (in 2023) |
| Ohio | 5 years | 5% (in 2023) |
| Oklahoma | 5 years | 9.5% (in 2023) |
| Oregon | 10 years | 9% |
| Pennsylvania | 5 years | 6% |
| Rhode Island | 20 years | 12% |
| South Carolina | 10 years | 11.5% (in 2023) |
| South Dakota | 10 years | 10% |
| Tennessee | 10 years | Determined by Court |
| Texas | 10 years | 5 – 15% |
| Utah | 8 years | 6.73% (in 2023) |
| Vermont | 8 years | 12% |
| Virginia | 20 years | 6% |
| Washington | 10 years | Determined by Court |
| Washington D.C. | 12 years | 6% (in 2023) |
| West Virginia | 10 years | 7% (in 2023) |
| Wisconsin | 20 years | 1% + Prime Rate |
| Wyoming | 5 years | 10% |
