What Happens If a Defendant Does Not Pay a Judgment?

Quick Answer

A defendant who doesn’t pay a civil judgment will not be jailed just for nonpayment, but the creditor can enforce the judgment by garnishing wages, freezing bank accounts, recording liens, and having the sheriff seize and sell non-exempt property.

Interest and collection costs accrue until the judgment is satisfied or discharged in bankruptcy.

Courts do not collect judgments for you—creditors must use legal tools to enforce them.

Can a Defendant Go to Jail for Not Paying a Judgment?

You cannot be jailed for failing to pay a civil debt. However, you can be sanctioned for ignoring court orders, such as refusing to appear at a debtor’s examination or failing to comply with discovery requests. In extreme cases, contempt of court can lead to fines or jail time—not because of the debt itself, but because of disobeying a judge’s order.

Explanation

In the United States, “debtors’ prisons” are a thing of the past; the legal system does not allow imprisonment simply for unpaid civil debts like contract damages or personal injury awards.

An unpaid judgment is a civil matter, and the consequences are financial, not criminal.

There are narrow exceptions where jail can result from nonpayment, but those involve violating specific court orders rather than just owing money. For example, willfully failing to pay court-ordered child support or criminal fines can lead to contempt of court proceedings and potential incarceration.

However, these situations are different from an ordinary civil judgment. Courts also distinguish between a debtor’s inability to pay and willful refusal to obey a court order. Only intentional disobedience (in limited contexts, like ignoring a court’s order to pay support or hiding assets in defiance of a court directive) might result in jail time.

In short, owing money on a civil judgment, by itself, will not put a defendant in jail. The creditor must use civil collection remedies instead.

What Creditors Can Do to Enforce a Judgment

When a defendant does not pay voluntarily, creditors may use post-judgment remedies, including:

• Wage garnishment. A portion of the defendant’s wages can be taken directly from their paycheck.
• Bank account levy. Creditors can freeze and seize money in the defendant’s bank accounts, subject to exemptions like Social Security or retirement funds.
• Judgment liens. A lien can be recorded against real estate and some personal property, preventing its sale or refinancing until the judgment is paid.
• Sheriff’s levy and sale. The creditor can ask the sheriff to seize non-exempt assets and sell them to satisfy the judgment.
• Post-judgment discovery. Defendants may be compelled to disclose their assets under oath, often through depositions, interrogatories, or subpoenas.

Costs and Interest Add Up for Unpaid Judgments

Unpaid judgments accrue statutory interest. For example, a $5,000 judgment with a 10% interest rate becomes $5,500 after one year and $6,105 after two years.

In addition, creditors may be entitled to recover collection costs, increasing the total amount owed.

How Defendants Can Legally Avoid Paying a Judgment

Even when a defendant cannot pay a judgment in full, options exist:

• Exempt assets. Certain property, such as Florida homestead property, retirement accounts, and protected wages, may be safe from creditors.
• Settlement. Creditors may agree to accept a reduced lump sum payment.
• Bankruptcy. A Chapter 7 or Chapter 13 filing may discharge or restructure debts.
• Asset protection planning. Legal strategies can help protect property even after judgments are entered.

What Usually Happens After Not Paying a Judgment

The first thing a judgment creditor usually does when a defendant does not pay a judgment is get more information about the defendant’s assets. This includes requesting a fact information sheet, debtor examination, or financial documentation.

Once a judgment creditor knows where the defendant banks, the creditor usually will attempt to garnish the defendant’s bank accounts. Bank account garnishment is a quick and straightforward way for a judgment creditor to get paid.

If bank account garnishments are not successful, then the judgment debtor may move on to the foreclosure of real property or business interests.

Does Appealing the Judgment Collection?

Filing an appeal does not automatically stop collection. A defendant must post a bond (also called a supersedeas bond) to pause enforcement until the appeal is resolved. Without a bond, creditors may still pursue collection while the appeal is pending.

Settling a Judgment After Nonpayment

Given the difficulties and costs of chasing an unpaid judgment, it’s very common for creditors and debtors to negotiate a settlement.

For example, a creditor might agree to accept a lesser lump-sum amount (or a payment plan) in exchange for giving up on trying to collect the full judgment balance. Creditors consider this when the debtor’s non-exempt assets are insufficient or hard to reach. A reduced payment now may be better than an uncertain amount later after expensive legal efforts.

Once the debtor fulfills their end of the bargain, the creditor will file a Satisfaction of Judgment in the court records. This is an important step that officially marks the judgment as paid, clearing it from the debtor’s record and ensuring the creditor cannot pursue further collection on that judgment.

From the debtor’s perspective, obtaining a recorded satisfaction of judgment is crucial to clear liens on property title and to repair credit history.

Settling a judgment is often a practical choice when a stalemate occurs: the debtor’s key assets might be protected by law or otherwise unavailable, and the creditor realizes that aggressively chasing the debt may yield little result.

Debtors with primarily exempt assets have more negotiating power because creditors cannot seize those assets.

On the other hand, creditors weigh the time and expense of continued collection litigation against the benefit of a guaranteed partial recovery. Ultimately, both sides may find it prudent to avoid protracted post-judgment battles.

A well-negotiated settlement allows the creditor to recover something and lets the debtor move on and avoid more drastic collection measures.

Key Takeaways

• Defendants cannot be jailed for not paying a civil judgment, but they can face contempt for ignoring court orders.
• Creditors can enforce judgments using garnishments, levies, liens, and sheriff sales.
• Interest and costs increase the balance until the judgment is resolved.
• Asset protection planning helps lead to a settlement.

Frequently Asked Questions