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Judgment Rate Of Interest For Medical And Personal Debt Changes In California!


Everything Changes For Judgments Entered After January 23, 2023.

While interest on a money judgment continues to accrue at 10% there are now several exceptions to this. If you have a judgment against you in California, you should know if an exception applies to you.

Exception 1: A judgment for medical expenses where the principal is less than $200,000, the rate of interest is 5%. California Code of Civil Procedure 685.010(a)(2)(A)(i).

Exception 2: A judgment for personal debt where the principal is less than $50,000, the rate of interest is 5%. California Code of Civil Procedure 685.010(a)(2)(A)(ii).

Personal Debt is defined as: money due or owing or alleged to be due or owing from a natural person arising out of a transaction in which the money, property, insurance, or services which are the subject of the transaction are primarily for the debtor’s personal, family, or household purposes.” (CCP 685.010(a)(2)(C)(iii)]

Further good news: the way the law reads a judgment might start out over the above limits which means the interest is 10%, but once the principal drops to meet the above criteria the interest rate will drop to 5%.

Also – the lower 5% DOES NOT APPLY TO COMMERCIAL DEBTS. Nor does it apply to debts obtained by tortious or fraudulent conduct or judgments for unpaid wages, damages, or penalties owed to an employee. [see CCP 685.010(a)(2)(C)(ii)]

Fitzgerald & Campbell, APLC represents consumers and small businesses with difficult debt problems with Debt Settlement, Judgment Contests, Settlements, and Liens, Debt Collection Harassment, Debtor Protection, Collection Lawsuit Defense, and Bankruptcy. We offer various services to assist you in dealing with different debts.

For a free consultation, call/text to (855) 709-5788 or contact us online today.

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