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February 16, 2023 Collections

Do Judgment Liens Expire in New Jersey?

A creditor seeking a legal obligation from a debtor may get a judgment lien. This is undoubtedly one of the best ways to ensure you will be repaid the money you are owed. Sometimes, a judgment lien is the only option, especially if you have exhausted your other collection avenues. If you are a party to a judgment, you will want to know, do judgment liens expire in New Jersey? An experienced attorney will help you through the situation and answer any questions. 

What is a Judgment Lien in New Jersey?

First, it is helpful to understand a judgment lien and how it is used. When a party owes money to another has not paid, the creditor may seek legal recourse. A lawsuit is a way to get a court judgment that requires the judgment debtor to repay the creditor. When a person who owes the money cannot pay, the court may impose a lien judgment against assets the person owns. 

A lien is put against the person’s real property, so they must use those funds to repay the debt. The judgment creditor is the person or entity who has been awarded damages in court. The person who owes the money and has a lien against his property is called the judgment debtor. The lien is a legal court order that requires the lien debtor to pay the judgment.

What are the Consequences of a Judgment Lien?

A judgment lien is a legal lien against the property to satisfy a debt. If a person has a lien against their property, it is considered an unclean title. This simply means the debtor must fulfill the requirement to repay the debt before removing the lien. A judgment lien can prevent someone from selling the property without first satisfying repayment of the debt. Generally, a person cannot transfer a property title until they resolve any judgment liens on real property. It is in a debtor’s best interest to repay the judgment before they take steps to sell their property. 

Do Judgment Liens Expire in New Jersey?

Whether you are a judgment creditor or debtor, you will want to know how long a judgment lien stays in effect. Once put in place, a judgment lien expires in 20 years in New Jersey. Many times, people retain possession of their real property for lengthy periods. A judgment creditor may request an extension of the lien if they have not yet been paid by the end of the initial 20-year period. You would need to request an extension prior to the expiration of the judgment lien. The initial 20-year period applies to official liens. A judgment debtor or creditor may obtain a certified copy of the judgment to review the details and dates. 

Factors That Impact Collection on a Lien

Although you may have gone through the legal process and obtained a judgment lien, it may be difficult to collect. Several factors could complicate the collection of a lien. Although a lien is attached to an individual’s property, they could have other liens on the property. This could prevent you from being able to collect all or part of the debt. In some cases, property changes hands due to trusts or inheritance. In these situations, generally, the lien remains with the property, and you can still collect on the debt. 

A party could declare bankruptcy, making it more challenging to collect the funds. Similarly, the property might be foreclosed upon, which could complicate matters or make collection impossible. Also, property owners are entitled to a homestead exemption. These issues are complex, and it is best to seek legal assistance from an experienced attorney to take further action for judgment enforcement

What is a Homestead Exemption?

It is essential to understand a potential limitation if you are seeking or have already obtained judgment liens on real estate. In New Jersey, homeowners have a homestead exemption. This is a fixed amount of the value of their home that you cannot take. This is true of the owner’s primary residence. Therefore, it is helpful to discuss the matter with a qualified attorney to determine how to proceed. 

Judgment liens can be complex, but we are here to help. At Snellings Law, LLC, we understand judgment liens and will answer your questions and assist you with your legal needs. Contact Snellings Law, LLC today to request a consultation.