Judgments That Are Microscopic
I am not a lawyer, I am a Judgment and Collection Agency Broker. This article is my opinion, from my experience in California. If you want legal advice, you should contact a lawyer.
Judgments and debts do not recover themselves. For this article, when the words (judgment debtor or judgment) appear, I mean judgments or debts. Judgments are stronger than debts, and most civil money judgments begin as debts.
Stronger than debts, there are more tools available to recover judgments. However, if judgments are too small, many enforcement tools get too expensive. Judgment and debt enforcement, are rather similar - when the amount owed is tiny.
Why recover a small (e.g., $400) judgment? Because there is a clear correlation between the size of a judgment and its recoverability.
The probability of half of, of a $400 judgment being enforced with only a little bit of effort are very good. The chances of half of, of a million-dollar judgment getting enforced (with 200 times as much effort) are nearly a million times less.
If judgments are small, it makes sense to contact the debtor by phone and/or mail, and very politely suggesting they satisfy it. Suggest a payment plan. Emphasize how you wish to help the debtor to get rid of their judgment debt and avoid any more hassles or expenses for them.
Instead of being a bill collector, be a friendly problem solver. The combination of being nice, then using cheap enforcement actions only if required, is a potent combination.
Of course, if the judgment cannot be enforced by mailing letters or calling, one has options. You may wait and let the judgment earn interest, record a cheap lien or recover the judgment using cheap techniques, or assign the judgment back to the creditor.
When judgment debtors are poor, try to discuss a payment plan, maybe $10-$20 per month? When you have a judgment, and when the debtor has assets however will not pay, even if you are patient and nice, think about a debtor exam later.
In a nice way, let the debtor know that they can avoid spending hours in court and/or extra expenses, by setting up a convenient repayment plan with you.
Never threaten anything. Common sense is, to raise the topic of the judgment debtor satisfying the judgment without consuming incurring any extra expenses for them, or more of their time.
Judgment debtor exams cost money, and such expenses can often be added to the debtor's debt. Of course, getting personally served with a court order for a court date, may cause a judgment debtor to locate their checkbook.
If the judgment debtor does pay you when you spent additional money, make sure they pay more to also cover your extra costs, for scheduling and serving the debtor examination, etc.
In conclusion, a judgment debtor willingly writing out a $400 check is much more likely to occur, than them writing a $40,000.00 check.
Every judgment recovery specialist's dream is to find a huge judgment and make a big enforcement quickly and cheaply. In the current economy, that doesn't happen often enough to be counted on as a realistic basic business plan.
For attorneys, there is little doubt that "heart attack letters" from lawyers impress some debtors. If you are an attorney, you can make money with a stern, yet polite template. By mailing demand letters, you may get many payments for the price of postage stamps.
It's time to look at smaller judgments, and have the goal of trying the powerful tools of selling the advantage of satisfying a judgment more often and being nice; and use expensive recovery techniques less often.
About the Author
http://www.JudgmentBuy.com - the fastest solution, where Judgments and debts quickly get recovered by the best - matched for free to your judgment debtor. JudgmentBuy.com is the fastest way for creditors and collection agencies to find each other. Mark Shapiro - the judgment expert, with the best quality free leads for enforcers, collection agencies and contingency collection attorneys.
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