Selling or assigning a Texas judgment: what a buyer asks for
A Texas judgment is property, and its holder can sell or assign it. A buyer is paying for a set of numbers and dates: what the judgment is worth today, how long it stays enforceable, and where its liens reach. Here is how a transfer is made under Texas law and the records a buyer usually asks to see.
In short
- A judgment of a court of record, or part of one, may be sold by a written transfer (Tex. Prop. Code §12.014(a)).
- A transfer acknowledged or sworn to like a deed may be filed with the papers of the suit, and once filed it gives notice to anyone who later deals with the judgment (§12.014(b)–(d)).
- A buyer usually asks for the judgment itself, its current payoff, the payment ledger, the writ history behind its dormancy date, and every abstract with its recording and indexing dates.
- Rules on collecting consumer debts can apply to a buyer; this guide does not cover them.
How a judgment is transferred
Section 12.014 of the Texas Property Code allows a judgment, or part of a judgment, of a court of record to be sold, even if it would not otherwise be assignable in law or equity, if the transfer is in writing (§12.014(a)). Section 12.014 is not necessarily the only way a judgment can be assigned, and it may not settle whether a particular assignment is valid: four justices of the Texas Supreme Court described it as a notice provision that neither validates nor invalidates assignments (Mallios v. Baker, No. 98-0408 (Tex. Jan. 6, 2000) (Hecht, J., concurring)). A written transfer is what can be filed and give the notice described below.
The written transfer may be filed with the papers of the suit if it is acknowledged or sworn to in the form and manner required for a deed (§12.014(b)), and the clerk records it (§12.014(c)). A transfer filed this way is notice to, and binds, anyone who later deals with the judgment (§12.014(d)). The statute says what a filed transfer does; it does not say what happens to one that is never filed.
What a transfer does not change
The judgment's rate is set by statute when it is rendered (Fin. Code §§304.002, 304.003): a fixed rate for most judgments, or the contract's terms where a contract sets a variable rate. Its dormancy and lien clocks run from the dates of its writs and abstracts (Civ. Prac. & Rem. Code §34.001; Prop. Code §§52.001, 52.006). None of those provisions turns on who holds the judgment.
What a buyer usually asks to see
A buyer is weighing what the judgment is worth and how long it can be enforced, so the questions follow the same statutes. The main records that answer them are below; the records guide has the full list, with the open questions on each.
| Record | What it answers |
|---|---|
| A copy of the signed judgment and the clerk's bill of costs, the docket entry or transcript if judgment was rendered earlier in open court, and any amended judgment, appellate judgment, mandate or remand order, which may control instead of the original | The amounts awarded, including court costs, the rendition date and the post-judgment rate the judgment states (Fin. Code §§304.001, 304.003(a), 304.005) |
| The contract that sets the interest rate, and any amendments, if the judgment is on one | Where the judgment's stated rate came from: a contract rate, capped at 18% (Fin. Code §304.002), or the monthly rate (§304.003) |
| A current payoff, good through a date | What is owed today, with interest compounded each year (§304.006) |
| The payment and credit ledger | Every amount received, with its date, so the payoff can be checked |
| Receipts for post-judgment costs | Which costs, such as writ and recording fees, are counted in the payoff |
| Any order extending a claimant's appellate briefing time, with its dates | Days on which no interest accrued (Fin. Code §304.005(b)); JudgmentVault does not calculate this pause |
| Each writ of execution, with its issue date and the officer's return | When the judgment goes dormant if no new writ issues, subject to the open question on writs never delivered to an officer (Civ. Prac. & Rem. Code §34.001) |
| Each abstract, with its county, recording and indexing dates and instrument number | Where the judgment may be a lien on real property, and when each lien ends. An abstract recorded while the judgment was dormant, or in a county where a §52.0011 finding pending appeal is recorded, creates no lien (Prop. Code §§52.001, 52.0011, 52.006) |
| Any tender of the full amount due, and any refusal of it | Whether interest stopped before the payoff date (see partial payments and credits) |
| Any recorded §52.0011 finding, and any recorded withdrawal of it, with county and recording dates | Whether a lien exists in that county: none while a recorded finding stands, and again once its withdrawal is recorded (Prop. Code §52.0011) |
| Any release of a county lien or of the judgment | Whether a lien or the judgment itself has already ended, and when |
| Any bankruptcy notice, the case's discharge, dismissal or closing, and any order on the stay or on the judgment debt or its lien | Whether collection is stayed, or the debt was discharged and the judgment can no longer be collected (11 U.S.C. §§362(a), 524(a)); see judgment records to keep |
| Any earlier transfers | That the seller holds the judgment it is selling (Prop. Code §12.014) |
| Any revival judgment, with the filed petition or motion and its filing date | That a judgment that went dormant was revived by a proceeding brought in time (Civ. Prac. & Rem. Code §31.006) |
A payoff is only as good as the ledger behind it, and a dormancy date only as good as the writ dates behind it. The records guide covers what to keep from the day the judgment is rendered.
Rules this guide does not cover
Someone who buys judgments on consumer debts and collects them may be a debt collector under federal and Texas law. In Texas, a third-party debt collector must file a surety bond with the Secretary of State before collecting consumer debts (Fin. Code §§392.001, 392.101). Whether those rules reach a particular buyer is a legal question this guide does not answer. JudgmentVault tracks a judgment's figures and dates; it does not collect, and it plays no part in a sale.
How JudgmentVault calculates a payoff and each clock is set out rule by rule in the Texas methodology.
Sources
- Tex. Prop. Code §12.014: a judgment may be sold by a written transfer, even if not otherwise assignable; filed with the papers of the suit if acknowledged like a deed, it gives notice.
- Mallios v. Baker, No. 98-0408 (Tex. Jan. 6, 2000): concurring opinion (four justices): §12.014 is a notice provision that does not itself validate or invalidate an assignment.
- Tex. Civ. Prac. & Rem. Code §34.001: when a judgment becomes dormant.
- Tex. Civ. Prac. & Rem. Code §31.006: revival of a dormant judgment within two years.
- Tex. Prop. Code §§52.001, 52.0011, 52.006: the abstract lien, county by county; no lien where a §52.0011 finding is recorded, until its withdrawal; and when it ends.
- 11 U.S.C. §362(a): a bankruptcy filing stays collection of the judgment.
- 11 U.S.C. §524(a): a discharge of the judgment debt bars collecting it.
- Tex. Fin. Code ch. 304: the post-judgment rate and annual compounding.
- Tex. Fin. Code §§392.001, 392.101: third-party debt collectors of consumer debts must file a bond.
The rules JudgmentVault applies, and which are still pending legal review, are listed rule by rule in how JudgmentVault calculates Texas judgments.