Sometimes. An out of state confession of judgment can be effective where the funder obtains judgment in a state that still permits it, then “carries” it to the debtor’s home state, which determines how much of a chance the debtor gets to fight. (You can read about the general legality of confession of judgment here.)
Can a New York funder still file a confession of judgment against an out of state business?
Not unless you have a place of business in the county where the funder will file for judgment. Since August 30, 2019, New York Civil Practice Law and Rules § 3218(b) allows an affidavit of confession to be filed only in the county where the defendant resided when it signed or at filing. CPLR 3218(b) treats a company as a person that “resides in any county where it has a place of business.” It applies to affidavits filed after that date, even if signed before.
The sponsor’s memo indicates that the law responded to creditors, “often from out-of-state,” had entered confessions of judgment in New York counties against “out-of-state small business owners with no connection to New York.” However, if you have a place of business (store, office, warehouse) in New York, a funder can still use a confession of judgment, and the law does not affect judgments already entered. Also, a confession can only be filed within 3 years of its signing, but a new one signed in a renewal or forbearance agreement starts the clock over.
Can a funder confess judgment against me in Pennsylvania?
Often. Pennsylvania Rule of Civil Procedure 2950 allows a confession of judgment so long as the instrument is not one “executed by a natural person in connection with a consumer credit transaction.” The judgment is obtained by filing a complaint with the prothonotary, Pa.R.C.P. 2951. Unlike New York, Pennsylvania’s confession rules contain no county of residence requirement.
After entry, the debtor must receive either:
- 30 days’ notice before execution; or
- a hearing within 3 business days if execution is made without notice.
The debtor gets one petition to strike or open, filed within 30 days of service of the notice, and any defense not raised is waived. See what to do after you have been served with an MCA confession of judgment .
Ohio only allows a cognovit to be filed in the county where the maker “resides or signed the warrant of attorney.” R.C. § 2323.13(A). Virginia, Texas (effective Sept. 1, 2025), and California now void or block cognovit clauses in sales-based or business financing at the source.
Can an out of state confession of judgment be enforced in my state?
It can be enforced once it is “domesticated” in your state. Under 28 U.S.C. 1738, courts must give a sister state judgment the same full faith and credit it has in the state that issued it. Most states allow domestication by filing an authenticated copy, although New York is an exception for judgments by confession, as the table shows.
| Your state | How a sister-state confessed judgment arrives | Key timing |
|---|
| Pennsylvania | May be filed with the prothonotary; not excluded by the statute, 42 Pa.C.S. 4306. | The prothonotary mails notice; the debtor may obtain a stay by posting security. |
| New York | A judgment “by confession” may not be registered in New York, CPLR 5401, and the funder must instead sue on the judgment, CPLR 5406, or move for summary judgment in lieu of complaint, CPLR 3213. | The debtor will be served and can ask for a hearing. |
| Florida | May be filed under Fla. Stat. 55.502, which does not exclude judgments by confession. | Applies to any judgment entitled to full faith and credit. |
| California | May be entered upon application, CCP 1710.10. | A motion to vacate must be made within 30 days of service of the notice of entry of the judgment, CCP 1710.40. |
Once the judgment is domesticated, the rules of that state apply. In Baker v. General Motors, 522 U.S. 222 (1998), the Supreme Court found that “[e]nforcement measures do not travel with the sister state judgment.”
If my state does not allow confessions of judgment, am I protected?
Not necessarily. The Supreme Court found there is “no roving ‘public policy exception’ to the full faith and credit due judgments.” However, a stronger argument may be that the judgment is not valid. A confession of judgment is based on consent. In D.H. Overmyer Co. v. Frick Co., 405 U.S. 174 (1972), the Court required that the waiver be voluntary, knowing, and intelligent, noting that an adhesion contract could change the result.
In Atlas Credit Corp. v. Ezrine, 25 N.Y.2d 219 (1969), the New York Court of Appeals, 4-2, refused to enforce 2 Pennsylvania confessions of judgment for approximately $1.3 million because the warrant allowed entry anywhere in the world without notice, violating due process. That case predates Overmyer and Baker, but it still makes a good argument. In Commercial Nat. Bank of Peoria v. Kermeen, 225 Cal. App. 3d 396 (1990), a California court refused an Illinois cognovit judgment on a $34,625.52 note absent a knowing waiver, though an MCA signed by a seasoned business owner could come out differently. See the list of elements that need to be proven to enforce a confession of judgment.
Frequently Asked Questions
My business is not located in New York, but I have a warehouse there. Can a funder confess judgment against me in New York?
Yes, in the county where your warehouse is located. According to CPLR 3218(b), a company is considered a resident of any county where it has a place of business.
I signed a confession of judgment before 2019. Is it now void?
It depends on if it was filed. The 2019 amendment applies to affidavits filed on or after August 30, 2019, so an unfiled one cannot be filed against a non-resident, and its 3 year filing window has long passed. A judgment entered before that date was not vacated and can still be carried to other states.
How will I know if the confession of judgment has been domesticated in my state?
Typically by mail. In Pennsylvania, the creditor submits an affidavit with your address and the prothonotary mails you notice. In New York, the creditor has 30 days after registering an eligible judgment to mail notice. In California, you are served with a notice of entry, which starts your 30 days to move to vacate.
Will I have two sets of deadlines?
Yes. If judgment is confessed in Pennsylvania, you have 30 days from notice to petition to strike or open it there. If it is simultaneously domesticated in California, you also have 30 days from service of the notice of entry to move to vacate in California.