Explaining that Judgment Collectors works on consignment is a way of differentiating our business from other collection agencies that purchase judgments. But the term ‘consignment’ can be confusing. This post is intended to clear up any such confusion. If you are looking to bring a collection agency in to help you collect your judgment, you should probably understand how consignment applies.
What It Means in Our Business
When people talk about consignment, they are typically talking about some sort of retail transaction. Think of selling a car on consignment. A card dealer accepts a used car from a private owner and sells that car on the person’s behalf. Most of the proceeds go back to that person. Meanwhile, the dealer gets paid for services rendered. Payment is usually equal to a certain percentage of the sale price.
Consignment works under a similar arrangement in our business. Technically, the term ‘consignment’ means the practice of consigning something. Check out the three definitions of ‘consign’ from the Miriam-Webster online dictionary:
- To give over to another’s care.
- To give, transfer, or deliver into the hands or control of another.
- To send or address to an agent to be cared for or sold.
For our industry’s purposes, consigning is turning control of judgment collection over to someone else. It is turning the judgment over to a collection agency for its care and enforcement.
How It Works Practically
Dictionary definitions don’t do the consignment principal justice, at least as it pertains to judgment collection. So let us talk about what consignment means practically. It is pretty simple when you look at it through the lens of an actual case.
Imagine a judgment creditor struggling to collect from a debtor who claims he has no valuable assets and insufficient income to make regular payments. That creditor turns the judgment over to us on consignment. The creditor is entrusting the judgment to our care. We are also given control over collection.
Just like a card dealer working on consignment would sell a car on behalf of its owner, we engage in collection efforts on behalf of the creditor. We do all the work involved in collection. We handle the research; we investigate leads; we attempt to contact a debtor; etc.
It really boils down to the creditor hiring us to do the work for them. But here is where it gets interesting: how we get paid. The consignment model dictates that we only get paid if we succeed.
Success Is Our Primary Goal
It goes without saying that success is our primary goal. Just like a car dealer who would never agree to sell a car on consignment if he didn’t think he could pull it off, we don’t take cases unless we are fairly confident that we can actually collect. Why? Because payment depends on how much we collect.
We have no incentive to take over your judgment and then not give it our best effort. In fact, we have every motivation to do the best job we possibly can. The more we collect on your behalf, the more we get paid.
Working on consignment not only protects you against poor service that might not yield satisfactory results, but it also ends your financial obligations. You do not spend another dime on collection efforts because we cover our costs in-house.
A Better Way to Collect
We take the position that letting a judgment collection agency collect on your behalf is better than trying to do it yourself. Moreover, working with a consignment-based agency like Judgment Collectors is better than selling your judgment.