Post Judgment Interest
When a Judgment is rendered, the balance of the judgment increases over time due to Post Judgment Interest. Some old rates are as high as 18%. Typically Post Judgment Interest is about 6% of the final balance of the judgment.
The average Post Judgment Interest Rate is about 6%. However, judgments prior to 2008 often have interest rates of 18%. Many balances will double in value after 5 years because the Post Judgment Interest continues to accrue.
The Judgment balance doubles quickly because the Post Judgment Interest compounds over time. Every year the interest continues to compound and accrue on the judgment. It is important to avoid a judgment in the first place.
Avoiding a Judgment
The best way to handle a judgment is to not have to deal with it in the first place. If you receive a lawsuit against you, be sure to answer the lawsuit prior to the due date. The answer must be signed and filed with the Court. Also be sure to send a copy to the attorney who is suing you.