Tag: Creditors Rights Tennessee

Debt Settlement Advice: Bring Proof that You’re Broke or Don’t Bother Making an Offer

I’m a creditor rights attorney, and, with the economy the way it is, I’m filing collection lawsuits left and right.

In most cases, the borrowers are too broke to hire a lawyer to respond, so they ignore the lawsuit and let a judgment be entered against them. In some cases, however, the borrowers are pro-active and call me to make a settlement proposal.

In the past, when property still had equity and people were just one loan application away from a $40,000 Home Equity Loan, creditors weren’t listening to low-ball offers. Even today, it’s still not true that banks will happily accept 10% of whatever they’re owed.

If you’re going to make a low-ball offer, support it with proof that you’re paying them the last pennies you have. You need to show the creditor:

  • A recent financial statement;
  • A list of all assets, such as cars, real property, cash, other bank accounts;
  • A list of all debts (which shows the creditor who else is chasing you);
  • Copies of recent bank statements;
  • Recent pay stubs;
  • A budget showing your monthly expenses; and
  • Anything else that proves that you don’t have the money to make a better offer.

Again, the rumors of debt settlements for pennies on the dollar are wildly exaggerated. Creditors will accept discounted payments, but they aren’t approaching these proposals blindly. When in doubt, they decline bad proposals.

If you want a steep discount, you have to work for it, and assembling the information listed above is step one in the process.

Enforcement and Domestication of Foreign Judgments in Tennessee: Simple Under The Uniform Enforcement of Foreign Judgments Act

To creditors’ chagrin, judgments aren’t enforceable across state lines. Before a Tennessee judgment can be enforced against the debtor’s assets in Florida, the creditor has to “domesticate” that judgment, which requires that a second action be filed in the new state to recognize the out-of-state judgment.

Fortunately, this process is governed by a commonly adopted act, the Uniform Enforcement of Foreign Judgments Act (Tenn. Code Ann. § 26-6-101, et. seq.), which creates a stream-lined process for creditors to follow.

It’s generally just a two step process. The creditor must (1) file an authenticated copy of the judgment and (2) file a supporting Affidavit. In most cases, the judgment of the sister state will be entitled to “full faith and credit” by the new court.

There are limited grounds for attack on domestication. The defendant doesn’t get to re-litigate the case; instead, he or she can only contest procedural defects, like no service of process or fraud. These issues must be raised in the 30 days after service of the domestication action.

On June 30, 2011, the Tennessee Court of Appeals issued a new opinion, at Cadlerock, LLC v. Sheila R. Weber, which provides a good summary of the issues and law presented on foreign judgment enforcement actions. This Act isn’t often litigated, but this is a good case to have handy, just in case.