Debt collection agencies are a dime a dozen. Go to any urban center and you will find tons of them. On the other hand, there are far fewer collection agencies specializing in judgment collection. That’s because judgments are unique. Collecting them requires a different skill set, a different body of knowledge, and a willingness to do things that standard debt collectors don’t do.
For the record, a judgment is either a court-ordered civil penalty or recognition of an existing debt. Some cases combine both. The law allows plaintiffs in civil cases to collect judgments themselves. They can also hire attorneys and general debt collection agencies to do the work.
So why does judgment collection exist as a separate discipline? Why would creditors hire a company like Salt Lake City’s Judgment Collectors instead of using an attorney or general collection agency? These top five reasons explain it all:
1. Courts Don’t Compel Payment
Even though a judgment cannot exist without a court order, courts do not actually compel payment. The court’s job is to recognize that the debt in question is legitimate and legally viable. Such recognition is accomplished with the entered judgment. But after that, courts step out of the way. They leave collection to creditors and their assigned representatives.
The fact that courts don’t compel payment automatically gives the advantage to defendants. They know that without a court’s involvement, creditors will have a harder time extracting payment.
2. Debtors Are Often Dishonest
You would probably not be surprised to learn that many of the debtors that companies like Judgment Collectors track down are less than honest. Debtors often don’t tell the truth about where they work, what assets they own, etc. It is up to the judgment collection agency to dig around until they uncover the truth. That could mean a lot of digging that general collection agencies aren’t willing to do.
3. Debtors Often Hide Assets
In addition to being dishonest, debtors are known to hide their assets to avoid payment. They can use very creative means to do so. As such, finding those assets can be tricky. General collection agencies do not tend to have the resources or knowledge to find what debtors have hidden. Specialized judgment collection agencies do.
This is perhaps the biggest reason judgment collection is a thing. Finding hidden assets is not easy. It involves highly specialized skills and the right investigative tools. It is just something that general debt collectors aren’t particularly good at.
4. Enforcement Times Are Limited
On average, states allow judgment enforcement to run for between seven and 10 years. That may seem like a long time, but it’s really not when you’re trying to hunt down debtors who have skipped town and hidden their assets. Limited enforcement time means that collection efforts have to be effective right from the start. A general collection agency will not be as effective as the creditor needs them to be. On the other hand, a good judgment collector starts making progress right away.
5. Collection Efforts Are Costly
Finally, many general collection agencies avoid judgments because they are costly to collect. Note that collection law is very specific about the procedures collectors can use to chase down unpaid judgments. Those procedures require debt collectors to do certain things that can add up to a significant financial investment. Specialized judgment collection firms are willing to make that investment. General collection agencies are not.
Judgment collection is a defined specialty within the debt collection industry. It is necessary because collecting unpaid judgments is complex and time-consuming. If it were easy, everyone would be doing it.