Alternatives to Hiring a Collection Attorney for a Michigan Small Claims Judgment

Why People Look for Alternatives

In a General Civil Division collection matter, a Michigan collection attorney typically charges $200–$400 per hour or takes 33–40% of whatever they collect on contingency. On a $5,000 judgment, contingency means the attorney keeps $1,650–$2,000 — and that is only if they collect the full amount. For judgments under $2,000, most attorneys will not take the case at all because the economics do not work.

The good news: Michigan's Small Claims Division was designed for self-represented parties. Attorneys are prohibited from participating in a Small Claims Division case, including postjudgment proceedings, under MCL 600.8408(1), and the same SCAO enforcement forms are available to anyone. You have real alternatives, and most of them leave more money in your pocket.

Alternative 1: Self-Guided Enforcement (Best for Most Creditors)

You file the enforcement forms yourself using the free SCAO paperwork, with a step-by-step guide providing the filing sequence, fee calculations, and compliance tracking.

How it works: After the 21-day waiting period, complete the debtor-examination affidavit on Form MC 11, have a judge issue the subpoena, and arrange personal service with the statutory witness fee. Then target assets with the appropriate garnishment writ — MC 12 for wages, MC 13 for bank accounts, MC 52 for tax refunds. You track the garnishee's compliance deadlines yourself and file Form MC 17 when the judgment is satisfied.

Cost: A one-time guide purchase plus $15 per writ filing and statutory disclosure fees ($35 for wage garnishments and $1 for bank garnishments). All court costs are recoverable from the debtor through the sworn balance on the writ.

You keep: 100% of the judgment amount (minus court costs the debtor reimburses).

Best for: Judgments up to $7,000 where the debtor has identifiable assets and you are willing to handle the paperwork.

Limitation: If the debtor contests enforcement in the Small Claims Division, you must handle that proceeding yourself; attorneys may not participate in the case, including postjudgment proceedings.

Alternative 2: Collection Agency

You hire a licensed collection agency for out-of-court collection contacts. Michigan bars assignment of small claims judgments and bars collection agencies from participating in Small Claims Division proceedings, including postjudgment enforcement (MCL 600.8407(1), 600.8408(1)).

How it works: You sign a collection-services agreement. The agency contacts the debtor through letters and phone calls. Some agencies may report a collection account to credit bureaus after meeting applicable contact and reporting requirements. If the debtor still refuses, the agency cannot pursue court enforcement in the Small Claims Division; you must handle those filings yourself.

Cost: 25–50% of whatever the agency collects, plus a possible upfront fee of $50–$200. On a $5,000 judgment, that is $1,250–$2,500 gone.

You keep: 50–75% of the collected amount.

Best for: Creditors who want out-of-court collection contacts and are willing to sacrifice a significant percentage. Also useful when you have no idea where the debtor works or banks and do not want to file a debtor examination yourself.

Limitation: A collection agency or its agent cannot participate in Small Claims Division litigation, including postjudgment proceedings. You must pursue court enforcement yourself.

Alternative 3: Mediation Through the Court

Some Michigan district courts offer post-judgment mediation where a neutral third party helps you and the debtor agree on a payment plan.

How it works: You request mediation through the court (not available in all districts). A mediator facilitates a conversation between you and the debtor about a voluntary payment schedule. If both sides agree, they can set up a voluntary payment plan.

Cost: Mediation through the court is often free or low-cost. Private mediation runs $100–$300 per session.

You keep: 100% of the judgment amount, paid over time according to the plan.

Best for: Situations where the debtor acknowledges the debt but genuinely cannot pay in full immediately. Also works when you want to preserve a relationship (landlord-tenant, neighbors, business associates).

Limitation: Mediation requires the debtor to participate voluntarily. If they are ignoring you entirely, they are unlikely to agree to mediate. If the debtor defaults on an agreed-upon voluntary installment plan, you must seek formal court enforcement, such as garnishment.

Alternative 4: Waiting (Strategic Patience)

You hold the judgment and wait for the debtor's financial situation to improve before pursuing enforcement.

How it works: Michigan money judgments are enforceable for 10 years under MCL 600.5809(3) and can be renewed for an additional 10 years if renewed before expiration. Interest accrues under MCL 600.6013(8). You monitor the debtor's situation and file enforcement when they acquire attachable assets.

Cost: Free, but you earn nothing in the meantime.

You keep: 100% of the judgment plus accumulated interest — eventually.

Best for: When the debtor is genuinely judgment-proof right now (no job, no bank account, no non-exempt property) but you have reason to believe their circumstances will change.

Limitation: Ten years is not forever. If you do not renew the judgment before it expires, you lose the opportunity to extend it for another 10 years. You also need a way to monitor when the debtor's situation changes — which may require periodic debtor examinations (MC 11), with a $15 filing fee plus personal-service, witness, and mileage costs.

Comparison Table

The Decision Framework

Start with self-enforcement if the debtor has a job, a bank account, or property you can identify. You keep 100% and control the timeline. The Collecting a Small Claims Judgment in Michigan guide maps every step from the 21-day waiting period through case closure.

Try mediation if the debtor is willing to talk and you prefer a payment plan over forced garnishment.

Use a collection agency if you want out-of-court collection contacts and are willing to pay the agency's cut; you still handle any Small Claims Division enforcement yourself.

Wait if the debtor is genuinely judgment-proof right now. Mark the renewal deadline (10 years from judgment date) on your calendar and check back periodically.

You can start with self-enforcement and try mediation if the debtor engages. A collection agency cannot participate in Small Claims Division proceedings, and an attorney cannot represent you in that case, including after judgment.

Frequently Asked Questions

Can I switch from a collection agency to self-enforcement?

Small-claims judgments cannot be assigned under MCL 600.8407(1), and collection agencies cannot participate in Small Claims Division litigation under MCL 600.8408(1). If you hire an agency for out-of-court contacts, review the agreement's termination terms; court enforcement remains yours.

What if the debtor files for bankruptcy after I start collecting?

An automatic stay under federal bankruptcy law halts all collection efforts immediately — garnishments, liens, debtor exams, everything. You must stop all enforcement and file a proof of claim in the bankruptcy case. This applies regardless of which collection method you chose.

Is post-judgment interest worth waiting for?

For a general, noncontract judgment, MCL 600.6013(8) calculates interest from the complaint filing date through satisfaction, at a rate based on the five-year U.S. Treasury Note rate plus one percent and adjusted every six months. A judgment based on a written instrument with a specified lawful rate is governed by MCL 600.6013(7). At the 4.959% rate effective July 1–December 31, 2026, a $5,000 balance accrues about $248 per year at that annualized rate, before any rate change or payments. Significant over several years, but not enough on its own to justify waiting if the debtor currently has attachable assets.

Can I use more than one alternative at the same time?

You can file self-enforcement paperwork while also attempting mediation. If you hire a collection agency for out-of-court contacts, review the agreement for any exclusivity terms; the agency cannot participate in Small Claims Division proceedings, and the judgment cannot be assigned.

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