Successful entrepreneurs rarely begin a new venture without first developing a sound strategy. The same holds true for corporate executives, investors, researchers, and military planners. So why do so many judgment creditors jump into the collection game without first coming up with a plan?

I have been researching and writing on judgment collection for years. I have read a lot of posts, talked to a lot of people, and looked at a lot of hard numbers. I can tell you that attempting to collect a judgment without a sound strategy in place almost always guarantees failure. This is one endeavor you don’t want to try off the cuff.

There Are a Lot of Moving Parts

I have had this discussion with plenty of people who sincerely questioned just how hard judgment collection could be. It seems so simple. You have your attorney contact the debtor’s attorney a day or so after the conclusion of the trial. They work out the arrangements and you get paid in a few weeks. Right? Wrong.

Collecting a money judgment is quite complex. There are a lot of moving parts between legal maneuvers, rules established to protect debtors, and even debtor attempts to avoid paying. If collecting were easy, most money judgments would be paid in full. But the truth is that most are not.

A Strategic Approach Is Best

Coming up with a plan is the first step in successful collections. But a plan without a built-in strategy will not be much different than going in with no plan at all. The bottom line is that a strategic approach to planning his best. What do I mean by this? I mean that every aspect of your plan should be developed around a particular strategy.

For example, one of the first steps in devising a collection plan is to do a thorough asset investigation. Judgment Collectors, a specialized collection agency based in Salt Lake City, UT, explains that creditors should be doing everything they can to assess and identify debtor property, income, bank accounts, etc. Literally every asset needs to be accounted for.

What is the strategy here? To identify assets a creditor can go after by way of property liens and writs of execution. Both are very good motivators to pay. Debtors really don’t want to lose valuable property, so if they know a creditor is poised to threaten a property, they are more likely to pay.

Multiple Collection Methods

Smart judgment creditors will include multiple collection methods in their plans. They will consider:

• Wage and bank garnishment
• Debt and tax refund garnishment
• Property (real estate) liens
• Asset seizure in sale

Even settlements and payment plans should be on the table. Again, what is the strategy?

The strategy is to use as many collection methods as possible, all simultaneously. Doing so is like attacking an enemy on all fronts. The more collection methods in play, the greater the pressure on the debtor to pay up. Most debtors can only stand so much pressure before they crack.

Judgment Collectors suggests going after low hanging fruit first. In other words, before considering writs of execution to seize and sell property, go after wages and bank accounts via garnishment. Success with simpler methods may mitigate the need to pursue their more complex counterparts.

Collecting an outstanding judgment is not as easy as it might appear. In fact, collection is often harder than winning the court case. So it’s important the judgment creditors go into collection with a sound strategy in place. Otherwise, collection is a lot like flying blindly into a storm. It’s not good.