Has your business ever gotten a judgment in a court, only to find it was worthless because you didn’t have the time or the know-how to collect it?
Judgment Marketplace aims to solve that problem for you.
JudgmentMarketplace.com is a website for selling and buying judgments. Small business owners, corporations and consumers who have won a court judgment against another party can list the judgment for sale. Collection agencies and law firms that specialize in skip tracing debtors and collecting on judgments, can negotiate to buy your judgment or, just like on eBay, can “buy it now.”
The software platform provides a centralized place to list judgments for sale, and for buyers to find them. A wide range of judgments can be bought and sold: car accidents, employment or discrimination cases, commercial transactions, contractor claims, foreclosures.
Judgment Marketplace was started by Shawn Porat, who also serves as CEO. He learned the collection business helping his father, owner of a trucking company, collect hundreds of judgments the company was owed. Before age 23 he had started Recovery Of Judgment, a New York-based firm that specializes in executing judgments. Porat says he started Judgment Marketplace because he saw there was a demand for buying and selling judgments, but no organized market.
The site serves those who have a judgment and want to turn it into cash. But it also is a source of business development for collection agencies and law firms that collect judgments. The marketplace also serves investors who buy large portfolios of judgments.
Let’s take a closer look at the site and see how it works.
Buying a Judgment
The first step is to register for free. Once you’ve done that, you can search and browse judgments that others have listed – by State, by cheapest judgments, by largest judgments, or “best deal”. “Best deal” ranks judgments based on asking price as a percentage of the judgment’s amount.
As of this writing, you can buy a judgment in the face amount of $16.5 Million ($17.5 Million if you include interest) for a cool $12 Million.
Out of your price range (heh)? No worries. As little as $25 buys you a judgment of roughly $1,100 with interest.
Once you identify a judgment you are interested in, you initiate a Letter of Interest. That starts a dialogue with the seller to negotiate on the price or complete the “buy it now” transaction.
Upon striking a deal, Judgment Marketplace recommends that you use Escrow.com to exchange the sales price and the assignment of judgment, but that’s up to whatever you negotiate. Then after the transaction is complete, you are encouraged to come back to the site and leave feedback about the seller.
Selling a Judgment
When you sell a judgment you sell it at a discount off of face value. The nature of collecting judgments is that they’re uncertain. Risk is involved. So by selling at a discount, the seller gets the certainly of an immediate payment (compared to possibly collecting zero). The buyer potentially gets some upside that makes it worth the risk. If the buyer collects the full amount he has made a profit to balance his risk.
It costs nothing to list a judgment for sale although you can buy featured listings. A processing fee of 5% is assessed on each sale.
The site also offers a collection network offering traditional collection services. Collectors must pay to be part of the collection network.
Why Use Judgment Marketplace
Obviously, small businesses would only need the site if they had a judgment going uncollected. For them, the site may be invaluable. Many small businesses aren’t familiar with how to collect a judgment or even how to find a collection agency, especially if the debtor is out of state. Collecting at a distance has added challenges. So an online marketplace is a convenient and easy option.
For smaller collection agencies and collection law firms, the marketplace could be a source of new business opportunities if you need more judgments to chase after.
We haven’t used this marketplace. We saw a demo at the New York Business XPO recently, and later registered for a free account. So we can’t say how well it performs. But it appears a promising platform for a niche purpose. If you are frustrated because you haven’t been able to collect a judgment, check out Judgment Marketplace.