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  1. #1

    Default Settling a Personal Judgement

    My question involves collection proceedings in the State of: Texas

    I have had a judgement that has been through the legal system and I have lost. I am trying to settle this out of court as the person that has the judgement against me is threatening to send this to collections (total judgement is 12K). He has agreed to settle for 7K to keep it out of collections, but I am concerned on how I can protect myself. What sort of documentation do I need from him in order to legally protect me that he has agreed to settle? I dont want to send him 7K and then still have him come after me or send this to collections.

    Currently the discussions between us have been happening over email and phone. Do I need something notarized or the emails back and forth are proof? Any help would be greatly appreciated.

  2. #2
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    Default Re: Settling a Personal Judgement

    Just fyi:

    Texas is a very, very pro-debtor state. Your wages cannot be attached by anyone other than a government entity, and for regular creditors there's a list of exemptions here: http://www.statutes.legis.state.tx.u.../htm/PR.42.htm

  3. #3

    Default Re: Settling a Personal Judgement

    Quote Quoting Dogmatique
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    Just fyi:

    Texas is a very, very pro-debtor state. Your wages cannot be attached by anyone other than a government entity, and for regular creditors there's a list of exemptions here: http://www.statutes.legis.state.tx.u.../htm/PR.42.htm
    This is interesting but I have a hard time fully understanding the article. So are you saying under this circumstance, even though I have a job and own my home, that a personal judgement against me he cant touch either of these things which would include garnish my wages?

    This site is awesome and thanks for the help!

  4. #4
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    Default Re: Settling a Personal Judgement

    Much of a judgment debtor's property in Texas is protected from seizure by creditors, even if they have a judgment. See Chapters 41 and 42 of the Texas Property Code.

    Except for collection by mortgage note lenders or taxing authorities, or construction lien claimants who perfected a homestead mechanic's lien contract, a debtor's home is protected from seizure by a creditor. Retirement plans and life insurance are also from creditor seizure. For a single person, $30,000, and for a married person, $60,000 of personal property is exempt from seizure. Cash is not exempt, whether in your bank account or hidden in your home.

    The last sentence is important. They can't garnish your wages, but they absolutely can levy your bank account once your wages are in there.

  5. #5

    Default Re: Settling a Personal Judgement

    Thank you once again...I cant believe how valuable this forums have been...why has it taken me so long to find this place?

    One last question. I have some money in stocks (not a 401k or retirement account). Is that subject to being levied?

    Thanks again for all your help...

  6. #6
    Join Date
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    Default Re: Settling a Personal Judgement

    Ya gotta love Texas. Under exemptions for personal property:


    Sec. 42.002. PERSONAL PROPERTY. (a) The following personal property is exempt under Section 42.001(a):
    (1) home furnishings, including family heirlooms;
    (2) provisions for consumption;
    (3) farming or ranching vehicles and implements;
    (4) tools, equipment, books, and apparatus, including boats and motor vehicles used in a trade or profession;
    (5) wearing apparel;
    (6) jewelry not to exceed 25 percent of the aggregate limitations prescribed by Section 42.001(a);
    (7) two firearms;


    (8) athletic and sporting equipment, including bicycles;
    (9) a two-wheeled, three-wheeled, or four-wheeled motor vehicle for each member of a family or single adult who holds a driver's license or who does not hold a driver's license but who relies on another person to operate the vehicle for the benefit of the nonlicensed person;
    not only did they specify you are allowed to keep a firearm, you are allowed to keep two of them.

    and then you get to keep a motorcycle or other little fun vehicle for EACH person that has a driver's license.

    to the stocks:

    depends on how you came to own them:

    Sec. 42.0021. ADDITIONAL EXEMPTION FOR CERTAIN SAVINGS PLANS. (a) In addition to the exemption prescribed by Section 42.001, a person's right to the assets held in or to receive payments, whether vested or not, under any stock bonus, pension, annuity, deferred compensation, profit-sharing, or similar plan, including a retirement plan for self-employed individuals, or a simplified employee p
    If they came to be yours through a stock bonus program from your employer, they are exempt. Otherwise I find nothing stating they are safe.,

  7. #7
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    Default Re: Settling a Personal Judgement

    Quote Quoting jk
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    Ya gotta love Texas. Under exemptions for personal property:


    not only did they specify you are allowed to keep a firearm, you are allowed to keep two of them.

    One for each hand, of course.

    - - - Updated - - -

    Quote Quoting Ultimatedragon
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    This is interesting but I have a hard time fully understanding the article. So are you saying under this circumstance, even though I have a job and own my home, that a personal judgement against me he cant touch either of these things which would include garnish my wages?
    I am amazed that a Texan would not know that the Constitution of the Lone Star State prohibits wage garnishment.

    Article 16 - Sec. 28. GARNISHMENT OF WAGES. No current wages for personal service shall ever be subject to garnishment, except for the enforcement of court-ordered:

    (1) child support payments; or

    (2) spousal maintenance.


    http://www.constitution.legis.state.tx.us/

    - - - Updated - - -

    Quote Quoting Ultimatedragon
    View Post
    My question involves collection proceedings in the State of: Texas

    I have had a judgement that has been through the legal system and I have lost. I am trying to settle this out of court as the person that has the judgement against me is threatening to send this to collections (total judgement is 12K). He has agreed to settle for 7K to keep it out of collections, but I am concerned on how I can protect myself. What sort of documentation do I need from him in order to legally protect me that he has agreed to settle? I dont want to send him 7K and then still have him come after me or send this to collections.

    Currently the discussions between us have been happening over email and phone. Do I need something notarized or the emails back and forth are proof? Any help would be greatly appreciated.
    Yes, you absolutely do need a written settlement agreement and for the amount of money involved.

    I strongly suggest that you pay a lawyer to prepare a good one for you and make sure it gets signed by somebody in authority at the judgment creditor (plaintiff himself if this was a personal lawsuit).

    And make sure you get the agreement AND the Satisfaction of Judgment in hand WHEN you hand over a cashier's check from a different bank than your own (do I need to explain why?)

    Never rely on promises that somebody is going to do the paperwork after you pay. Have your paperwork ready for signature and then have a sit down with the judgment creditor face to face to make the exchange.

  8. #8
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    Default Re: Settling a Personal Judgement

    Quote Quoting Ultimatedragon
    View Post
    He has agreed to settle for 7K to keep it out of collections, but I am concerned on how I can protect myself. What sort of documentation do I need from him in order to legally protect me that he has agreed to settle?
    You can consider all of the suggestions about exemptions from collections, but none of those suggestions will remove the judgment from your credit report.

    If you want to settle the debt while protecting yourself, you will negotiate for the entry of a satisfaction of judgment in association with your payment of the agreed amount.

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