When you cannot recover a judgment yourself, and you cannot afford to pay a lawyer by the hour to attempt to recover your judgment, and you cannot sell your judgment for more than a few pennies on the dollar; your best choice is to find a contingency recovery solution.
Contingency judgment recovery means future payment. You do not get paid cash up front, you get money in the future if and when, money is recovered from your judgment debtor. Usually, there are no expenses to the judgment owner. Usually, it takes a long time to get any money.
One contingency judgment recovery choice is to assign your judgment to a judgment enforcer. However, there are other solutions that do not require you to assign your judgment. Examples are a contingency lawyer or a collection agency. This article is my opinion, and not legal advice. I am a judgment broker, and am not a lawyer. If you ever need any legal advice or a strategy to use, please contact a lawyer.
There is a wide variation in the collection agencies that recover judgments. Most of them are old-school, and use only the telephone and letters, to attempt to annoy judgment debtors into paying. The best collection agencies also use lawyers, and look for judgment debtor assets to have the Sheriff levy. They work just like judgment enforcers do, except you do not have to assign your judgment to them. Usually, when you have a contingency expert recovering your judgment, and no progress is being made, it is because your judgment debtor has no assets showing.
When a collection agency is owned and run by lawyers, often they are not allowed to pay court costs or Sheriff fees. That means even if they charge you nothing upfront, and nothing per hour, you might have to pay some court fees, which are modest when compared to hourly attorney fees.
When you retain a contingency collection lawyer, there are two kinds of lesser-known fees you might face. In some states and situations, you might have to pay the court costs. Also, some lawyers have Quantum Meruit contract clauses where if you fire the lawyer, you might owe them for the time and expenses they put into trying to recover your judgment, even if no progress has been made.
Most people would prefer to be paid cash up front for their judgments. However, for every actual judgment buyer, there are a thousand contingency recovery experts. And, when you do not have to assign your judgment, there is not that much difference, because cash up front buyers must perform due diligence, which can take weeks, or you might have to wait for 90 days to be paid because of the chance of the debtor filing for bankruptcy protection.
When your judgment debtor is poor, cash upfront judgment buyers will pay you almost nothing, and usually no contingency recovery solution will get you paid either. When your judgment debtor is middle-class, a judgment buyer may pay you a few pennies on the dollar, and a future pay contingency expert will probably recover some or all of your judgment money in the future.
When your judgment debtor is rich, cash judgment buyers will take a few weeks to carefully research your judgment situation, because rich debtors can hire lawyers to fight recovery efforts, or hide their assets. Future pay contingency experts might recover money in weeks, if your judgment debtor has lots of available assets showing. So when your judgment debtor is rich, you get money quick, no matter what recovery option you choose.
With some future payment contingency recovery solutions, you do not have to assign your judgment. That means you keep ownership, you pay nothing upfront, and usually nothing at all. You do not spend any time or go to court, and get about half or most of what may get recovered.
When you want cash up front, shopping your judgment does not help much because actual judgment buyers all pay about the same. They always pay for judgments based on what the judgment debtor’s situation is. Shopping a $5,000 judgment (with a non-rich debtor) with ten judgment buyers, might eventually bring you a range of offers from (e.g.) $240 to $265.
With contingency recoveries, you can shop around, however there is a problem because often you get what you pay for. Someone that charges 30% to recover your judgment may not try as hard as someone charging you 50%. Sometimes, the cheapest contingency rates come from people that are not very good at recovering judgments. They may try to get as many judgments as they can, and spend very little time on ones that do not look really easy.
When some good judgment recovery companies charge you 33%, they make you pay some court costs, which is not always their idea, it is often the law. The 50% ones usually absorb the fees. When your debtor is rich, a judgment broker knows the best deals. Contingency future-payment recovery is the way most judgments actually get collected. If your debtor has lots of assets, you can get money quickly.