Winning a money judgment opens the door to collecting from a debtor in ways that aren’t possible without going to court first. For example, wage garnishment is only possible after a judgment has been obtained. Likewise for writs of execution and judgment liens.
The big question for your average creditor is whether or not to turn collection efforts over to an agency. Getting a collection agency involved means paying for help. Assuming the collection agency gets every penny the creditor is owed, the creditor still loses something by having to pay the agency for its services.
Judgment Collectors is a Utah agency that specializes in collecting judgments. While some collection agencies purchase judgments for pennies on the dollar, Judgment Collectors works on consignment. They say there are five very good reasons to turn collection over to an agency like theirs:
1. Collection Expenditures Cease
Collection agencies working on consignment pay all their own expenses. They cover the costs of their collection efforts. Therefore, turning a judgment over to an agency immediately causes all collection expenditures to cease. The judgment creditor doesn’t spend another dime on collection. That could be a very big deal, especially if a creditor is paying staff members to pursue collection efforts rather than doing their normal jobs.
2. Time Can Be Invested Elsewhere
Collecting an outstanding judgment is a time consuming affair. Note that it can take months to make any headway with an uncooperative debtor. It could ultimately take years to collect the full amount. This is time a judgment creditor could spend on more productive things. That’s exactly what happens when a creditor turns collection over to an agency. The agency takes the case while the creditor invests his time elsewhere.
3. Debtors Know the Game
Next, debtors know how the collection game is played. And even if one does not, his attorney will advise him after the fact. Between them, debtors and attorneys can throw up plenty of roadblocks preventing the creditor from pursuing payment. But here’s the thing: a collection agency knows how the game is played. A good collection agency can go up against the best debtors and attorneys and still win.
4. Asset Searches Are Part of the Game
A key strategy among uncooperative debtors is to hide their assets. They might transfer the title of a boat, RV, or luxury vehicle to a family member. They might fail to disclose a piece of investment property located in a neighboring county. All of this is to say that successful collection almost always requires an asset search.
Specialized collection agencies know how and where to search for hidden assets. They can find all sorts of things a debtor is trying to hide. Most creditors can’t do the same thing. They have neither the knowledge nor resources to conduct asset searches.
5. Skip Tracing Is Also on the Table
Last but not least is the reality that some debtors simply pack up and move. They don’t bother to leave forwarding address information either. In such cases, the only way to find them is to employ something known as skip tracing. Most creditors have no idea what it is, let alone how to do it. But collection agencies are experts in skip tracing. It’s part of what they do.
Attempting to collect a judgment in-house is certainly an option. Any creditor can choose DIY collection. But there are very good reasons to turn collection over to a specialized collection agency. If I won a money judgment, I wouldn’t hesitate to bring an agency in right away.