Listing Agent Question: I have a client with a judgment creditor lien – arising from credit card debt – that has attached to the property we are trying to sell in the District of Columbia. The judgment creditor lien arose from a judgment issued in December, 2005. The judgment was issued in the amount of ~$10,000.00 at a rate of 15.50% per annum – that judgment has ballooned to over $55,000.00 courtesy of the power of compounding interest. This amount would force a short sale and cause major delays for closing. What do we do?
The Listing Agent’s question essentially boils down to this: When do judgment creditor liens automatically release in the District of Columbia?
A judgment creditor is a person or entity that has obtained a valid judgment for the payment of money from a court of competent jurisdiction. Once a valid judgment has been issued, the judgement creditor must perfect the lien by filing the judgment in the land records – this puts the world on notice that the judgment creditor has a lien against the property. Judgment creditor liens encumber the property and prevent debtors from selling the property without paying off the lien.
DC Code §15-101, titled “Enforceable Period of Judgments; Expiration” states:
(a) Except as provided in subsection (b) of this section, every final judgment or final decree for the payment of money rendered in the – (1) United States District Court for the District of Columbia; or (2) Superior Court for the District of Columbia, when filed and recorded in the office of the Recorder of Deeds of the District of Columbia, is enforceable, by execution issued thereon, for the period of twelve years only from the date when an execution might first be issued thereon, or from the date of the last order of revival thereof.
(b) At the expiration of the twelve-year period provided by subsection (a), the judgment or decree shall cease to have any operation or effect. Thereafter, except in the case of a proceeding that may be then pending for the enforcement of the judgment or decreed, action may not be brought on it, nor may it be revived, and execution may not issue on it.
The ultimate answer to the Listing Agent’s question was that they needed to do nothing! In this particular case, the judgment was issued over twelve years ago. Federal Title & Escrow was able to verify that the judgment creditor had failed to renew their judgment creditor lien prior to expiration. The lien automatically discharged pursuant to DC Code §15-101, and the settlement closed without a hitch.