You sued and won your New York debt collection case. The judgment issued in your favor allows you to lien the debtor’s real property. The following NY debt collection judgment lien created is valid for up to 10 years. But what happens after a decade is up? Does the lien your judgment creates expire or can you extend it?
Fortunately, because a judgment is valid for 20 years and can only act as a lien for 10 years, New York allows you to extend.
There are two ways for the holder or assignee of a valid NY debt collection judgment to extend the judgment as long as it has not been satisfied, settled, or paid in full. Which route you take will depend upon the underlying facts and circ*mstances of your situation.
Option One
Renew the judgment: New York Civil Practice Law and Rules (CPLR) 5014.
The first and most popular option in our NY debt collection practice is to renew the judgment. Renewing the judgment will extend your ability to use it as a lien on real property for an additional 10 years.
You can make the application by starting a separate action on the debt collection judgment. You will need to confirm to the court that:
- The judgment has not been satisfied, and;
- You are the original judgment creditor or have acquired the judgment by a valid assignment.
The application should be made a little bit short of a year before the lien expires. If you allow the lien to expire before “renewing” the judgment, there will be a gap during which your lien will not attach to the underlying property.
During this gap period, the judgment debtor can sell, transfer, or encumber the property.
In order to avoid a gap between the expiration of the initial 10 years and the effective time of renewal, the renewal should be brought at the beginning of the ninth year.
However, you can renew the judgment after the lien has expired. The creditor should make sure collection counsel understands that the initial 10 year lien periodbegins when the judgment is awarded. It does not begin when affirmative steps are taken to use the New York debt collection judgment as a lien.
Take for example a creditor who recovered a $250,000 judgment on January 1, 2018. Then they learned in January 2019 that the debtor owned property in Westhampton and immediately docketed the judgment with the Suffolk County Clerk. The 10 years starts on January 1, 2018. Not January 2019, when the New York debt collection was recorded as a lien against real property.
Using the wrong date can lead to a “gap” period during which time all equity in the house may be lost.
Option Two
Extend the judgment: CPLR 5203 (b)
The second option is applicable if you were stayed from executing on the judgment during the 10-year lien period or if the Sheriff was going to execute against the property.
Under this scenario, you would extend the lien by making a motion to the court. The difference between proceeding in this manner as opposed to renewing the judgment is that you can only extend the lien for a shortened period of time. That would be the amount of time you were stayed from executing or the additional time needed for the sheriff to foreclose.
There are many tools available for debt collection in New York. Using your NY debt collection judgment as a lien and extending it is only one of them.
For experienced NY debt collection counsel contact FFGN. We have the experience that pays.
FAQs
A judgment is valid for twenty (20) years and may be extended once for an additional period of ten (10) years. To extend a judgment for an extra ten (10) years, the Judgment Creditor must make written application to the City Court.
Do judgment liens expire in New York? ›
A Judgment against the Debtor remains as a lien against real property for a period of ten (10) years, renewable for an additional ten (10) years.
What is the statute of limitations on a judgement in NY? ›
A money judgment is presumed to be paid and satisfied after the expiration of twenty years from the time when the party recovering it was first entitled to enforce it.
Do judgements ever expire? ›
Money judgments automatically expire (run out) after 10 years. To prevent this from happening, you as the judgment creditor must file a request for renewal of the judgment with the court BEFORE the 10 years run out.
How do I enforce a default judgment in New York? ›
If the Judgment Debtor, the party who lost during the trial, does not pay you voluntarily, you may contact an enforcement officer. The enforcement officer will either be a Sheriff who works for the County or a City Marshal who is independent. For a list of enforcement officers visit the Resources page.
What happens if a defendant does not pay a judgment in New York? ›
The creditor can often place a lien on your property, such as a house or car. The lien must usually be paid off before you can sell the property. Seize assets. Sometimes, a creditor can get a court order to seize other assets or personal property you own, such as a vehicle or real estate, to satisfy the debt.
How can a Judgement be removed in NY? ›
In a Nutshell
But you can have this judgment vacated or removed. To do so, you need to have a reasonable excuse for not appearing in court and a defense to the allegations against you. You also have grounds to vacate if the person suing you didn't properly serve the required documents.
How to renew a judgment in New York? ›
A judgment is valid for twenty (20) years and may be extended once for an additional period of ten (10) years. To extend a judgment for an extra ten (10) years, the Judgment Creditor must make written application to the City Court.
How long before a debt is uncollectible in NY? ›
The New York statute of limitations for consumer debt is three years. This means creditors or debt collectors have three years to try to collect on an unpaid debt or sue you for a debt. After this time limit has expired, the debt is considered time-barred.
What is the new debt collection law in NY? ›
Effective April 7, 2022, the New York statute of limitations for debt collection lawsuits arising out of a consumer credit transaction is reduced from six years to three years. Also, payment toward the debt or written or oral affirmation of the debt by the consumer does not revive or extend the limitations period.
Judgments are valid until satisfied or discharged; however, when a period of five years lapses, the judgment holder must file a motion with the court and prove sufficient cause for failure to obtain a writ of execution.
What does it mean if a judgement is expired? ›
Most judgments (the court order saying what you're owed) expire in 10 years. This means you can't collect on it after 10 years. To avoid this, you can ask the court to renew it.
What is a renewal of judgement? ›
The renewal of judgment allows the creditor to take legal action to collect the debt, including wage garnishment, bank levy, and even property foreclosure. This can be done by enforcing the judgment through court orders such as garnishment, levying on bank accounts, and foreclosing on property.
What happens after a default Judgement is issued in NY? ›
Default Judgments
The default judgment usually gives the plaintiff the right to collect the amount of money that was asked for in the complaint, plus interest and court costs. The judgment will appear on the defendant's credit report, and it can be there for up to seven years if it is not paid.
Can a judgment creditor take my house in New York? ›
In New York, a judgment lien can be attached to the debtor's real estate -- meaning a house, condo, land, or similar kind of property interest. In addition, New York allows judgment liens on the debtor's personal property -- things like jewelry, art, antiques, and other valuables.
Can a creditor get a judgement without me knowing? ›
A judgment is a legal action or lawsuit against you to recover debts. It is possible to have a judgment against you without your knowledge. When it does happen, you may not have been served the original summons because your address is not up-to-date, or you weren't served the summons properly.
How long can a Judgement real property lien remain in effect in New York quizlet? ›
A judgment lien results from a lawsuit. It attaches to real and personal property as a result of a money judgment issued by a court in favor of a creditor. It lasts for ten years and can be renewed.
How long can creditors go after an estate in NY? ›
Under New York law, in order to collect from an estate, a creditor must file acclaim within 7 months from the date that the Surrogate's Court judge issues letters to the executor.
How long is a federal judgment enforceable? ›
Some federal judgments are good for 20 years before a renewal is required. However, some states have decided to use their own limits: for example, in Florida, the limit is five years. Generally, one must wait two weeks before starting to enforce a federal judgment.
How long do you have to file a summary judgment in NY? ›
If the court does not set a deadline, summary judgment motions must be made no later than 120 days after a party files the note of issue, unless good cause is shown to extend the deadline.
You sued and won your New York debt collection case. The judgment issued in your favor allows you to lien the debtor’s real property. The following NY debt collection judgment lien created is valid for up to 10 years. But what happens after a decade is up? Does the lien your judgment creates expire or can you extend it?