Starting A Judgment Referral Business

August 9, 2023

There are two popular ways to start or run a judgment-related business. You can do everything yourself, or you can outsource some or all of a judgment business. There are many ways to learn how to recover judgments and run a conventional judgment recovery business. This article highlights an alternative idea for a judgment business, where you refer most or all incoming judgment leads to either a judgment broker or a nationwide collection agency.

An important part of any judgment business is finding potentially good judgment leads. There are not as many good judgments out there as there used to be. Usually, the easy ones are recovered by the creditors or their lawyers. 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.

Judgment brokers, and possibly some collection agencies and others, pay referral fees for judgment leads you send to them. The choices are usually pennies per raw lead, or about 5% of what is eventually recovered in the future. Most people do better over the long term with 5% of what may be recovered in the future.

To increase the chances of a judgment lead paying off, you might try to get a copy of the judgment, and what is known about the judgment debtor along with the judgment from the creditor. That way, you will know the creditor is serious, and the creditor is ready to have their judgment be enforced.

You could create a nationwide judgment recovery referral business, using only marketing. If you only refer judgment leads, then little judgment recovery knowledge or skills is needed, you only need to use marketing. To do this, you start by finding a judgment broker or a good collection agency.

In this business model, you tell judgment owners you know the best company to recover their judgment. When the judgment debtors have assets, judgment owners do not always have to assign their judgment, and can get their judgments recovered at the best rates. If the judgment debtors are rich, judgment owners get the best possible rates. That should help convince many judgment creditors.

Because you will know the best place to refer judgment owners to, you simply screen the creditor a bit, and gather information and refer their judgment lead. You should learn enough so that you will know what you are talking about, however when you do not enforce judgments, life is much cheaper and easier.

If you simply refer all incoming judgment leads, and owned no judgments, you could work in every State. You could help judgment owners worldwide, without learning much about judgment enforcement laws. For this to work, the following conditions must be true, to avoid complications, legal involvement, or appearing in court, at least not for any matters related to the judgment leads you refer:

1) You do not have ownership of any judgments.

2) You do not represent anyone else.

3) You do not try to enforce any judgments.

4) You do not contact any judgment debtors.

5) You do not charge any money, or have any contracts with any judgment owners or judgment debtors.

If you only refer judgments and follow the five conditions above, you could have a home-based judgment referral business. All you would need is a computer, a simple database or spreadsheet to keep records on, a backup solution, a phone with voicemail to catch missed calls, a fax (or a web-based fax solution, for example, and a post office box (or the UPS store).

If you refer all incoming judgment leads, your job is only marketing. The new way is the web, unfortunately everyone has discovered this, so it takes a lot of work or money to get noticed. I recommend making or getting a simple web site, if only to save you time explaining things. You could hire, or do your own web and SEO marketing, or just put up your web site. You could try getting 1,000 business cards printed and dressing well, and handing them to people coming out of court, or to attorneys. Or, you could have no business cards at all, and use only the internet.

Even if you decide to start or run a judgment referral business, nothing stops you from learning how to recover judgments, and taking and enforcing certain judgments where the judgment debtors are local to you.

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