What to Look for In a Judgment Collection Agency
You have successively won your lawsuit. The court has entered a judgment in your favor. Now it is up to you and the defendant to make arrangements for settlement. But what happens if the defendant fails to pay? You may have to turn to a judgment collection agency for help.
JudgmentCollectors.com is a Utah-based collection agency that specializes in judgments. In fact, they do not collect any other types of debts. They work on cases in six states including Utah, California, and Arizona. They recommend being very particular about choosing a collection agency. Here is what they say creditors should be looking for:
1. An Experienced Staff
Judgments are somewhat unique because they are governed by specific state laws. In light of that, collection agency staff really need to know their stuff. They need plenty of experience if they hope to use the tools and resources available to them to track down debtors and make them pay. Needless to say, experience is particularly important.
2. The Right Tools and Resources
The most successful judgment collectors utilize tools and resources that are not always available to attorneys. And due to their specialized nature, judgment collection firms tend to have access to things that general collection agencies do not. Judgment Collectors is a good example. They have developed their own proprietary tools for seeking out debtors, finding their assets, making contact, etc.
3. Tenacity and Perseverance
Experience and tools get the ball rolling. Sometimes though they aren’t enough. Sometimes judgment collectors also have to demonstrate tenacity and perseverance. They need to have a willingness to continue pursuing until they succeed. This is due to the fact that states limit judgments.
On average, a judgment is only enforceable for 7 to 10 years. The actual number depends on the state. At any rate, a creditor has to go back to court once the enforcement period expires. That essentially means starting over from scratch. The result is that debtors willing to play the waiting game can make life miserable for creditors. A good judgment collection agency is willing to be just as tenacious.
4. A Proven Track Record
Companies look for attorneys with a proven track record before they ever go to court. They need that same sort of thing after they win their cases. As such, looking for a competent judgment collection agency means looking for one with a solid track record.
One way to go about this is to research case studies. Collection agencies often publish case studies on their websites. And if not, creditors can always ask for them. The more you know about an agency’s success record, the more informed a company’s eventual decision will be.
5. An Acceptable Compensation Model
In terms of compensation, judgment collection agencies generally work under one of two models. The first model is to purchase judgments outright. The agency will offer a certain amount, which is always less than the actual value of the judgment itself. The other model is the contingency model.
A contingency based collection agency doesn’t charge anything upfront. They agree to work for a percentage of the total payment upon completion. If they do not succeed, they don’t get paid. In addition, they absorb all the costs associated with research, communication, tracking down assets, etc. The contingency model is not necessarily better, it is just different.
Any company in need of help collecting on outstanding judgments would do well to investigate specialized collection agencies. Just know that not every agency is the same. Proper research and direct communication are key to hiring the right firm.