What is Judgment Proofing?

Judgment Proofing comes into play when a creditor is trying to take the assets of someone who owes them money.

What is Judgment Proofing?

Judgment Proofing means that a person does not have enough assets, whether liquid or possessions, to be seized by a creditor. If a court orders a creditor to seize assets for payment, and a person does not have enough assets to fulfill that payment, the person is considered to be judgment proof.

A few things to know about Judgment Proofing:

  • Some assets cannot be seized by creditors. Things like food stamps, child support, and your pension cannot be garnished and used to pay creditors. These assets are not factored into whether a debtor is Judgment Proof.
  • Social Security income will also not be taken by a creditor, as that money is rightfully yours from the government.
  • Some states have different rules about what assets can be used to pay debts.
  • If you file for bankruptcy, your wages cannot be garnished, and you will not need to prove that you are Judgment Proof in order to not pay a creditor.

Typically, people who are Judgment Proof usually do not have a job, or have a very low paying job. They also likely do not own homes, cars, or any other possessions worth a lot of monetary value that could be taken by a creditor.  These individuals do not have much money in bank accounts that can be seized. As such, a lot of these people are also on food stamps or using other government programs for food and necessities. This will not affect whether a person is judgment proof.

To learn more about Judgment Proofing, or if you have any additional questions, you can click here to contact us. We are here to help you understand this process and answer any questions you might have.