If a defendant does not pay a judgment in Michigan, the creditor can enforce it for 10 years, renew it beyond that, pile on interest the entire time, and use a range of court tools to collect — garnishing wages and bank accounts, placing liens on real estate, seizing non-exempt property, and dragging the debtor into court to disclose assets under oath. Doing nothing is almost always the most expensive response.
The Judgment Doesn’t Expire Quietly
A money judgment from a Michigan court of record is enforceable for 10 years from the date it was entered. Before that window closes, the creditor can sue on the original judgment and get a fresh one, which starts a new 10-year clock.1Michigan Legislature. Michigan Code MCL 600.5809 – Period of Limitations A patient creditor can keep a judgment alive essentially forever.
Debtors often learn this the hard way. An old judgment surfaces when they try to sell a house, refinance a mortgage, or notice an unfamiliar deduction on a paycheck. Assuming the matter has gone away because years have passed is a bad bet.
Interest Keeps Running on the Balance
Michigan adds interest to every unpaid money judgment, and the clock starts on the date the original complaint was filed — not the date judgment was entered.2Michigan Legislature. Michigan Code MCL 600.6013 – Interest on Money Judgment The rate resets every six months: 1 percent plus the average yield on 5-year U.S. Treasury notes over the preceding six months, compounded annually.
For the period beginning January 1, 2026, the State Treasurer certified the Treasury yield at 3.725 percent, making the judgment interest rate 4.725 percent.3State of Michigan. Interest Rates for Money Judgments On a $50,000 judgment, that’s about $2,360 a year added to what you owe. Because interest compounds and reaches back to the filing date, a judgment that lingers for years can grow well past its original size.
Garnishment of Your Paycheck
Wage garnishment is the collection tool creditors use most. The creditor obtains a writ of garnishment from the court and serves it on your employer.4Michigan Legislature. Michigan Compiled Laws 600.4011 – Garnishment The garnishment stays in force until the full judgment balance is paid off.5Michigan Legislature. Michigan Code MCL 600.4012 – Garnishment of Periodic Payments
Federal law caps how much can come out of each paycheck. Under the Consumer Credit Protection Act, the weekly amount cannot exceed the lesser of 25 percent of your disposable earnings or the amount by which your disposable earnings exceed 30 times the federal minimum wage of $7.25 per hour, which works out to $217.50 per week.6U.S. Department of Labor. Fact Sheet #30: Wage Garnishment Protections of the Consumer Credit Protection Act Disposable earnings means what remains after mandatory deductions like federal and state taxes, Social Security, and Medicare. Voluntary deductions such as health insurance premiums or 401(k) contributions don’t lower the garnishable base.
Child support and alimony garnishments follow steeper limits: up to 50 percent of disposable earnings if you support another spouse or child, or 60 percent if you don’t, with another 5 percent added if payments are more than 12 weeks behind.6U.S. Department of Labor. Fact Sheet #30: Wage Garnishment Protections of the Consumer Credit Protection Act
Freezing Your Bank Account
A creditor can also garnish your bank account. The mechanics mirror wage garnishment: a writ from the court, served on your bank.4Michigan Legislature. Michigan Compiled Laws 600.4011 – Garnishment Once served, the bank freezes funds up to the judgment amount and later turns them over to the creditor.
The timing catches people off guard. You get notice, but the freeze is usually already in place by the time it reaches you. If your account holds protected funds — Social Security, unemployment, veterans’ benefits, workers’ compensation, or public assistance such as Family Independence Program grants — you can file an objection to release them. Social Security deposits are protected up to twice your monthly benefit sitting in the account at any one time.7Michigan Legal Help. Income Protected From Garnishment You have to act fast and raise the exemption yourself. The bank won’t do it for you.
Liens and Seizure of Property
A judgment lien on real estate is the slow, patient weapon in the creditor’s kit. By recording a certified copy of the judgment with the register of deeds in the county where you own property, the creditor attaches a lien that has to be cleared before you can sell or refinance. It doesn’t force an immediate sale, but it blocks any clean transfer of title and tends to force a settlement when you need to move the property.
Because judgments run for 10 years and can be renewed, a lien can hang over your property for a very long time.1Michigan Legislature. Michigan Code MCL 600.5809 – Period of Limitations If you own real estate jointly with a spouse as tenants by the entireties and only one of you is the judgment debtor, the lien may not attach — but that protection doesn’t help with joint debts.
The creditor can also seek a writ of execution, which directs a court officer to seize and sell non-exempt personal property. Once the officer levies, the property is bound from that moment.8Michigan Legislature. Michigan Code MCL 600.6012 – Execution Vehicles, equipment, and other tangible assets outside the exemption statutes can all be targets.
Being Hauled In for a Debtor’s Examination
If the creditor doesn’t know what you own, Michigan law gives them a way to find out. Under the supplementary proceedings statute, the court can order you to appear and disclose your finances under oath — income, bank accounts, real estate, vehicles, and anything else of value — and to bring supporting documents like pay stubs, tax returns, and bank statements.9Michigan Legislature. Michigan Compiled Laws 600.6104 – Supplementary Proceedings
The judge’s authority runs further than questioning. The court can block you from transferring assets, order specific non-exempt property applied to the judgment, or appoint a receiver to take control of your property.9Michigan Legislature. Michigan Compiled Laws 600.6104 – Supplementary Proceedings And the creditor doesn’t have to exhaust other collection methods first — these proceedings can start before a writ of execution has even been returned unsatisfied.
Skipping the examination is where things turn ugly. If you fail to appear after being properly summoned, the creditor can ask the court for a bench warrant for your arrest. The examination also tends to be the moment settlement talks get serious, since most people prefer a payment plan to a courtroom disclosure of their entire financial life.
What a Creditor Cannot Touch
Michigan law shields certain income and property from collection, but these exemptions aren’t applied for you. You have to raise them.
Income protected from garnishment includes:
- Social Security retirement and disability benefits, with bank-account protection limited to twice your monthly benefit amount.
- Supplemental Security Income.
- Veterans’ benefits.
- Unemployment and workers’ compensation.
- Public assistance, including Family Independence Program grants, food assistance, state disability assistance, and electronic benefit transfers.
- Michigan public employee retirement benefits and ERISA-covered pensions, though pension money loses some protection once it’s deposited in a bank account.
- Student aid disbursements, grants, and work-study payments, unless the debt being collected is an unpaid student loan.
Two caveats matter. Social Security can still be garnished for federal taxes or federal student loans. And in eviction cases, up to 10 percent of certain state public assistance benefits can be garnished to satisfy the judgment.7Michigan Legal Help. Income Protected From Garnishment Michigan also provides a homestead exemption covering a portion of your home equity, plus exemptions for family pictures, clothing, and other essential personal items.
If nearly all your income is protected and you own few non-exempt assets, you may effectively be judgment-proof. The debt still exists on paper, and the creditor can try again if your situation improves, but there’s nothing practical for them to attach to in the meantime.
Life Beyond the Credit Report
Unpaid judgments used to hammer your credit score. That changed in July 2017, when Equifax, Experian, and TransUnion stopped including civil judgments on consumer credit reports under the National Consumer Assistance Plan. Bankruptcies are now the only public record that shows up on credit reports.10Consumer Financial Protection Bureau. A New Retrospective on the Removal of Public Records
That doesn’t make a judgment invisible. Judgments are still public records. Landlords, lenders doing manual underwriting, business partners, and background-check services can find them. A recorded judgment lien will show up in any title search and block a sale or refinance until it’s resolved. Some lenders and insurers also look beyond the credit bureaus when they make decisions. The score drop is gone; the friction isn’t.
Your Options Instead of Ignoring It
Several paths exist, and the right one depends on how the judgment arose and what you own.
Challenge the Judgment
If you were never properly served with the original lawsuit, the judgment may be vulnerable to a motion to set it aside. Michigan Court Rule 2.105 lays out exactly how service must happen, either by personal delivery or certified mail with a return receipt the defendant signed.11Michigan Judicial Institute. Service of Process Table Judgments obtained by fraud or genuine mistake can also be attacked, though courts set a high bar.
Negotiate
Most creditors would rather collect predictable payments than chase assets. A negotiated installment plan, sometimes documented in a court-approved consent order, can stop further garnishments and levies. Some creditors will take a lump-sum settlement for less than the full balance, especially when the debtor’s finances are thin. Willingness to deal usually jumps after a debtor’s examination exposes modest resources.
Claim Your Exemptions
If a garnishment or levy hits exempt funds, file an objection with the court promptly. Wait too long and you can lose the exemption.
Consider Bankruptcy
For debtors buried under multiple judgments, Chapter 7 or Chapter 13 can offer broader relief than fighting each one. The automatic stay stops garnishments, levies, and other collection activity the moment you file. Whether the judgment itself gets discharged depends on what it’s for: debts arising from fraud, willful and malicious injury, embezzlement or larceny, domestic support obligations, and certain tax debts are not dischargeable.12Office of the Law Revision Counsel. 11 USC 523 – Exceptions to Discharge For ordinary contract debts and negligence-based personal injury judgments, bankruptcy often does provide real relief, though the creditor can file an adversary proceeding arguing the debt falls into a nondischargeable category.
Push Back on Abusive Collectors
The federal Fair Debt Collection Practices Act applies to third-party collectors and to attorneys who regularly collect debts through litigation.13Federal Trade Commission. Fair Debt Collection Practices Act Threats of violence, obscene language, harassing call patterns, and false statements about the debt or possible legal action are all prohibited. You can send a written request to stop contact, after which the collector may reach out only to confirm they’ll stop or to notify you of specific legal action. The FDCPA generally doesn’t apply when the original creditor is collecting its own debt, so the federal shield is thinner in that situation.
The worst outcome for most Michigan judgment debtors isn’t any single garnishment or lien. It’s letting interest compound and enforcement actions stack up while assuming the problem will solve itself. Even a partial payment plan or a single call to the creditor’s attorney puts you in a stronger position than silence.