In a down economy of disappearing jobs and spiraling downward wages, the value of raw judgment leads suffer. Only the (income, savings, or property) of the judgment debtor can repay a judgment. The weakest judgment lead is a raw lead. Raw leads are those pulled from a court house, or any other record source or service; where no effort has been made to contact the judgment owner or check the debtor for stability, assets, and prior bankruptcies.
Raw judgment leads are usually worth very little for many reasons. Judgment leads are worthless if the creditor cannot be found or if the judgment debtor cannot be found, or has died, moved overseas, went bankrupt, or is poor. When the judgment debtor is poor, or has expertly hidden their assets, the judgment lead is almost always worthless. Until the judgment debtor’s situation is known, the cash value of a judgment may be close to zero.
If the judgment creditor does not know the truth about their judgment, a judgment lead may be worthless. Some creditors think their judgments are cash, and will not sell them at any discount, or share anything with someone that recovers the judgment for them. If the creditor is not facing reality, and overvalues their judgment, it may never be recovered.
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. Some judgment owners used to ask me over the phone “How much will you pay me for my judgment?” Some of them have no idea who their judgment debtor is or where they live. They want an instant answer, however that answer could only be found after due diligence is done on their judgment debtor.
Some creditors learn quickly, when told the truth about their judgment debtor’s situation. Other creditors spend years contacting hundreds of people and companies before they finally accept the truth that their judgment is probably tough to recover. Getting any money back from your judgment is a major win.
The next judgment lead level is a warm judgment lead. This is when you have communicated with a judgment owner. This solves two potential problems, because the creditor is found, and they want their judgment enforced. The good news is the creditor might know something about their judgment debtor. The bad news is the creditor might be new, and in a comparative shopping stage, where they start out thinking they will get a better deal by shopping their judgments to, at least twenty judgment companies.
What a judgment creditor needs to understand is, judgment recovery is usually tough, courts are slow, and it is expensive and speculative to recover judgments. The average judgment sells for 1-7 percent cash up front or 50/50 future payment contingency recovery, where the judgment owner gets paid after judgment money is recovered. Unfortunately, some creditors over-value their judgments wildly, and that alone, can prevent them from ever recovering any money. Many creditors will not accept the truth about their judgments, and waste a lot of time, and will never get any judgment money.
The ideal creditor has already tried to settle with their judgment debtor, and were lied to, and was not paid. Then, they wasted a lot of time and money trying to recover their own judgment. Such real-world experience quickly teaches reality. It takes many creditors longer to learn and accept the truth about their judgment situation, than it did to win their judgment.
The best level of judgment leads are hot, those where the creditor has provided a complete package. A complete package is a copy of the judgment, the creditor’s contact information, and full information about the judgment debtor. When the package is complete, the only factors left are the judgment debtor’s situation, and the creditor’ beliefs.
The best judgment lead has a complete package, and the judgment owner knows the truth about getting a judgment recovered, and they are done shopping. Judgments do not age like wine, not in this economy. Better to start early, it is usually a long battle. Smart creditors find the best choice, and then take the first step quickly.
How can you get paid for judgment leads? There are two ways, you can sell raw leads, but nobody pays much for them. The better your judgment lead is, the more it is worth; however the full value of the lead is not known until the judgment is recovered. Judgment brokers pay lead sellers half of whatever they get paid.
The more you research the judgment situation on a lead, the more the lead may be worth. Although a raw lead is worth a dollar or so, you could increase its value by contacting the creditor. If you discuss with the judgment creditor, who their judgment debtor is; and make sure that the creditor is aware that judgments do not enforce themselves, and their judgment debtor owns some available assets, then you may have a valuable judgment lead.
As the economy has slid, there are less good judgments out there. Often when a judgment has not been recovered, there is a good reason. Reasons include the judgment was already satisfied, vacated, on appeal, the debtor went bankrupt, the debtor is poor; or there are multiple creditors, and one will not agree to sign paperwork to let the judgment be enforced, etc.
Even with valuable judgment leads, half of valuable judgment leads are worthless because the creditors are not willing to share with someone that recovers their judgment. I have talked to creditors that told me “I would rather let my judgment expire than share any part of it to get it recovered”.
If you have a judgment lead from a reasonable creditor that has moved out of the USA, then a judgment broker can help, or they could have someone at an American Consulate for the country they moved to, notarize documents such as assignment of judgment. In California, CCP 673 states the requirements for a judgment assignment, that it shall be assigned with the same notary requirements as for the conveyance of real property.