Judgment Collection
Judgment collection refers to the legal and operational process of obtaining and enforcing court judgments against defaulted MCA merchants — including litigation to obtain judgment, judgment domestication across states, and enforcement through asset seizure, garnishment, and bank levy.
Why This Matters
Judgment collection is the standard escalation path when workout negotiations fail. The process: file lawsuit in appropriate jurisdiction (typically merchant's home state or contract-specified venue), obtain judgment through litigation or default judgment if merchant doesn't respond, domesticate judgment in jurisdictions where merchant has assets, and enforce through bank account levies, asset seizure, or wage garnishment of personal guarantors. Timeline runs 3-12 months from filing to enforcement, with significant variation based on merchant cooperation and jurisdiction-specific procedures. Specialized MCA collection attorneys streamline the process with industry-specific expertise.
Frequently Asked Questions
Frequently Asked Questions
How successful is MCA judgment collection?
Variable success based on merchant solvency. Recovery rates typically run 30-60% of judgment amount when merchant has identifiable assets. Recovery approaches zero when merchant is judgment-proof (no assets, no income subject to garnishment). Personal guarantee enforcement against owner personal assets significantly affects total recovery.
What's the cost of MCA judgment collection?
Legal fees typically 10-25% of recovered amount on contingency arrangements, or hourly billing of $150-$500 for standard collection work. Court costs and process service fees add several hundred dollars per case. Cross-state domestication doubles or triples cost. Net recovery after costs determines viability of judgment collection vs. workout negotiation.