5 Common Mistakes Collectors Make When Pursuing Judgments

Judgment collection is a complex process that requires careful attention to detail, proper documentation, and strategic timing. Even experienced collectors can fall into common traps that delay recovery or reduce collection rates. In this article, we'll explore the five most frequent mistakes and how to avoid them.

1. Inadequate Pre-Judgment Documentation

Many collectors focus solely on obtaining the judgment without building a comprehensive documentation trail. This creates problems during enforcement when you need to prove the debt's validity, trace assets, or defend against debtor challenges.

What to do instead: Maintain detailed records of all communications, payment history, contract terms, and delivery confirmations. Organize documents chronologically and keep digital backups. This foundation becomes critical during garnishment hearings or levy proceedings.

2. Waiting Too Long to Begin Enforcement

Some collectors obtain a judgment and then wait weeks or months before initiating enforcement actions. During this time, debtors may move assets, change employment, or file for bankruptcy protection.

What to do instead: Begin asset investigation immediately after judgment entry. File garnishment orders within 30 days. The faster you act, the higher your recovery rate. Time is your most valuable asset in judgment collection.

3. Ignoring State-Specific Exemption Laws

Federal exemption laws provide baseline protections, but state laws often offer debtors additional shields. Collectors who ignore these nuances waste time pursuing protected assets and may face sanctions for improper collection attempts.

What to do instead: Research state-specific exemptions before initiating garnishment or levy actions. Understand homestead protections, wage garnishment limits, and exempt income sources. Consult with local counsel when operating in unfamiliar jurisdictions.

4. Poor Communication Strategy

Aggressive or inconsistent communication often backfires. Debtors become defensive, stop responding, or seek legal protection. Conversely, passive communication signals that you're not serious about collection.

What to do instead: Develop a structured communication plan that balances firmness with professionalism. Document all contact attempts. Offer clear resolution paths while maintaining enforcement pressure. Remember: your goal is recovery, not conflict.

5. Failing to Consider Settlement Options

Some collectors pursue full judgment amounts through enforcement even when settlement would yield faster, more certain recovery. This rigid approach often results in lower net recovery after accounting for enforcement costs and delays.

What to do instead: Evaluate settlement potential early. Consider the debtor's financial situation, enforcement costs, and time value of money. A 60% settlement received in 30 days often beats 100% recovery that takes 18 months and significant legal fees.

Key Takeaways

• Build comprehensive documentation before and after judgment
• Act quickly on enforcement to prevent asset dissipation
• Understand state-specific exemption laws thoroughly
• Maintain professional, strategic communication
• Remain flexible on settlement when it serves your interests

Avoiding these common mistakes requires discipline, knowledge, and strategic thinking. Collectors who master these fundamentals consistently achieve higher recovery rates with less effort and expense.