Selling A Judgment To A Collector
By Amy E. Feldman
PHILADELPHIA (CBS) - How do you sell a judgment?
People tend to think that winning a case in court is the hard part. But sometimes, that's only half the battle. Now comes the collecting it part. Which is why after waiting 17 years for OJ Simpson to pay up on the wrongful death judgment won by Ron Goldman's family, Mr. Goldman's mother is now offering to sell the right to collect on it.
Is that legal? Not only is it legal, it's pretty big business.
Many people win in court but don't have the know-how to collect the money, or don't want to pay the additional court fees to levy to collect on it. And there are some people who get legal settlements that are structured to be paid over time and they don't want to wait. So there are businesses that will pay to buy the right to collect on the debt.
The benefit is that the litigant gets cash now. But there are some pitfalls.
First of all, the percent of what you get paid up front can be as low as 1-5% of the judgment based on the likelihood of ever collecting. Once you sell it, you give up all future claim, even if all of the money, not just that small percent is recovered.
And, understand what the judgment buyer is offering. Some offer to collect the money for you but charge you costs to do so.
And, do reference checking because it would stink to hand over a judgment in a lawsuit to a company you then have to sue.
