When most people first win their judgment, they initially want to recover every dollar legally owed them. In reality, most judgments are never recovered at all. The judgments that are recovered, usually do not get recovered anything close to 100%.

This article is my opinion, and not legal advice. I am a judgment expert, and am not a lawyer. If you ever need any legal advice or a strategy to use, please contact a lawyer.

In cases where judgment debtors have available assets; creditors sometimes get chances to pay courts and Sheriffs, and perhaps process servers too; to attempt to levy their debtor’s bank account(s) and/or wages and/or property. Sometimes the creditor can also attempt to have the Sheriff levy and sell their debtor’s non-exempt property(s).

Usually, in the real world, even in ideal cases; not every dollar owed on judgments gets recovered. Generally, one should not attempt to squeeze every last dollar from their debtor, and these are the top five reasons why:

1) Settling is sometimes the best or only way to get paid, or to be paid quickly. By definition, settling means compromising on the amount owed to satisfy the judgment. Much depends on the available assets of the debtor. If they are poor, settling is often an alternative to them filing for bankruptcy protection; so many settlements are often for pennies on the dollar. Do not settle for anything but cash, the time for promises from the judgment debtor are long-gone. If you settle the judgment, and the debtor files for bankruptcy protection with 90 days, there is a chance you will get screwed and have no more judgment and have to return the settlement money to the bankruptcy trustee.

When your judgment debtor has assets and is doing well, settling might net you more money than paying the costs of a prolonged judgment enforcement effort and/or perhaps battling with their lawyer in court.

In cases of clever and rich debtors, that have expertly hidden “their” assets; settling for pennies on the dollar might be the creditor’s best or only chance to get paid. Of course, beware because such sneaky debtors sometimes do not pay you after the settlement agreement gets signed.

On large judgments, where the debtor has substantial and available assets; sometimes the debtor’s lawyer will do their best to insist that you must settle. The debtor’s lawyer will want it to look like they have done something. If you settle for (e.g., 75-80) cents on the dollar (your mileage will vary), it makes that lawyer look good, and will most probably get you paid more than any other way.

2) With default judgments, and judgments that are for much more than the plaintiff’s actual damages, and especially if notice of the original lawsuit was not personally and professionally served; often settle for less than the full amount owed. On default judgments, many judgment experts aim for 75-80% of what is owed, because that saves them more costs and risks of future recovery attempts; and it gets them paid faster. Sometimes, you need to settle for much less, partially to let your judgment debtor feel like they got a break; get paid now, and not face additional recovery costs and risks. Again, if your debtor files for bankruptcy protection within 90 days, you might still get burned.

3) Usually, when you levy your debtor’s bank account, you will not net enough from the levy to fully satisfy the judgment. Sometimes, during a wage levy process, the debtor will quit or lose their job. Sometimes, it makes sense to settle for a bit more than what you possibly already received and satisfy the judgment, so you can be done with the matter.

4) Even when you successfully recover every dollar that is owed, usually it will not include the costs of performing a final levy to recover your costs It makes no sense to levy the debtors assets again later, for that last (e.g., $150) owed, if the cost of doing so is $150; because this would just keep looping without being paid more.

5) Voluntary settlements may increase the chances that you will be able to keep what you get. Involuntary levies sometimes result in the debtor filing for bankruptcy protection soon afterwards; potentially making you return what you levied, because of bankruptcy-related “look back” laws.