I was approached with a judgment in 2020. The Debtor had no assets in his name, but clearly had money and was the type of guy that just wanted to avoid his debts. He had even filed Bankruptcy in the past 3 years. The Judgment Debtor had numerous LLCs and Corporations to shield his assets and muddy the waters, which obviously makes judgment collection trickier. I took the case and just said “let’s wait this out”. I knew the debtor would eventually get sloppy and lazy and acquire assets under his own name, making it far easier to enforce the judgment. So the waiting game began, and 2+ years went by.
I’ll admit it, the case wasn’t high on my radar, and a year went by when I wasn’t really giving it any thought. In early 2023, I did a public records search and it turns out that I had missed a golden opportunity. Just 5 months prior, the debtor had bought real estate for $1.2 Million in Tennessee in his name. However, 3 months later, he quit-claimed the property to his girlfriend for $1. The girlfriend then obtained a refinance loan, encumbering the property with substantial debt. With the property now standing in the name of the debtor’s girlfriend, I was basically out of luck. There was no judgment lien recorded in that particular county recorder’s office. The only recourse would’ve been a fraudulent transfer lawsuit against the girlfriend, but this would’ve been an expensive and time-consuming process. A fraudulent transfer lawsuit under these circumstances would’ve been a real pain in the neck to deal with.
Fortunately, it didn’t come to that. In April 2023, just a few months later, the debtor’s girlfriend, having successfully secured a refinance of the property, then quit-claimed the $1.2M property back to the debtor’s name!! As I was paying attention now, I found out just six weeks later, and I pounced on the chance to secure a judgment lien. There are few second chances in the business of judgment enforcement. This was my golden opportunity, for a second time, and I wasn’t going to let this one slip through my fingers again. I immediately overnighted the documents to the recorder’s office to create a valid judgment lien.
If I was not paying attention and didn’t act immediately, this judgment recovery would likely have never reached its conclusion. Just 31 days later, I received a phone call “we need a payoff demand for your judgment, the property is about to sell”. I received the full amount of the judgment plus interest shortly after: $96,000! Perhaps it was lucky, but paying attention to what the debtor is doing at all times is always the best strategy – as evidenced by this successful judgment enforcement outcome.
