Bulletin: NL000012

New Act. Congress has passed the Federal Debt Collection Procedures Act of 1990. This Act is effective May 29, 1991. The Act applies to judgments in favor of the United States.

• Creation of United States Judgment Liens. A judgment lien in favor of the "United States " is a judgment lien in favor of a federal corporation; an agency, department, commission, board or other entity of the United States; or an instrumentality of the United States. A judgment in favor of the "United States" is effective upon the filing of a certified copy of the (abstract of the ) judgment. A judgment is a judgment rendered in favor of the united states in a court created by congress. You should review your local records to verify whether a certified copy has been recorded.
  
  
• Duration of Lien and Renewal. The judgment lien is effective for twenty (20) years. The judgment lien may be renewed for one additional period of 20 years upon the filing of a notice of renewal. The renewal shall relate back to the date the judgment lien was originally filed. The renewal could theoretically occur at any time during the initial 20 year period, so long as the court approves the renewal.
  
  
• Applicability to Pre-Existing Judgments of the United States. The Act applies to judgments by the United States entered on or after May 29, 1981. Example : State law provides that a judgment lien is effective for 10 years. The United States secured a judgment on June 1, 1981 and recorded a certified copy on that date. The judgment lien is effective until June 1, 2001. It may be extended by a renewal.
  
  
• Exempt Property. The Act provides that property that is exempt under state law (including tenancy by the entirety or joint tenancy property ) or under federal bankruptcy law may be exempted from the judgment lien. State law exemptions (such as tenancy by entireties) are not automatic under the Act. Do not rely on the exemption unless you secure a court order for our review.
  
  
• Attachment. The United States may file a Notice of Levy on real property before securing a judgment. If the United States then secures a judgment, the judgment lien relates back to the time that the Notice of Levy was recorded. You must except to a recorded Notice of Levy.
  
  
• Redemption by Debtor. A judgment debtor may not redeem property after the execution sale in favor of the United States. Do not insure on an execution sale on a judgment in favor of the United States without review by our Legal Department.
  
  
• Redemption by "United States". If a superior mortgagee forecloses, the "United States" may assert a right of redemption for one year. The United States may claim this right even if the foreclosure is nonjudicial. If a prior mortgagee forecloses and extinguishes a United States judgment lien, add the following exception:

  "Rights of redemption of (state the "United States" entity in the judgment) for one year from (date of foreclosure)."

If state law creates a longer redemption period, except to that period.