Arizona Pre-Judgment Interest in Small Claims — A.R.S. § 44-1201 Rate and Calculation
What Arizona Law Says About Pre-Judgment Interest
When someone owes you money and refuses to pay, the debt does not sit frozen while you go through the court process. Under A.R.S. § 44-1201, you may be entitled to interest on the unpaid amount from the date the debt became due until the court enters judgment. This is called pre-judgment interest, and it can add a meaningful amount to your recovery — especially on debts that have been outstanding for months or years.
Pre-judgment interest is not automatic, though. It applies only to "liquidated" claims — amounts that can be calculated with mathematical certainty from existing documentation. An unpaid invoice for $3,200 is liquidated. A demand for "damages to be determined" based on pain and suffering is not.
The Interest Rate Formula
Arizona's interest rate statute uses a two-tier structure:
For non-medical debts, the rate is 10% per annum — unless a written contract specifies a different rate. If your contract says 8% annual interest on late payments, the contract rate controls. If the contract is silent on interest, the statutory 10% applies.
For post-judgment interest on non-medical debts, unless a statute or written contract sets a different rate, the rate is the lesser of 10% per annum or 1% plus the Federal Reserve prime rate on the date judgment is entered. On October 16, 2026, the prime rate was 7.00%, making the formula rate 8.00%; the rate stated in a judgment does not change after entry.
For medical debts, the cap is much lower: the lesser of 3% per annum or the weekly average one-year constant maturity Treasury yield for the calendar week preceding the date the consumer was first provided with a bill. This significantly reduced rate reflects legislative intent to limit the financial burden on medical debtors.
Which Small Claims Qualify
Pre-judgment interest works well for claims built on specific, documented amounts:
- Unpaid invoices — the invoice states the exact amount owed and the date payment was due
- Security deposits — the lease specifies the deposit amount, and you can calculate interest from the date the landlord should have returned it (within 14 days, excluding weekends and legal holidays, after the tenancy ends, possession is delivered, and the tenant demands a refund under A.R.S. § 33-1321(D))
- Contractor deposits — you paid a specific amount on a specific date, the contractor failed to perform, and you can calculate interest from the date you demanded a refund
- Loan repayments — a promissory note states the principal and due date
Claims where the damage amount requires subjective judgment — property damage estimates, diminished value of a vehicle, or the "fair cost" of incomplete work — are generally not liquidated and do not qualify for pre-judgment interest.
Free Download
Get the Arizona Small Claims Filing Checklist
Everything in this article as a printable checklist — plus action plans and reference guides you can start using today.
How to Calculate It
For a simple annual rate of 10% on a liquidated debt:
Divide 10% by 365 to get the daily rate (0.0274%). Multiply the daily rate by the principal amount owed, then multiply by the number of days from when the debt became due to the expected judgment date.
Example: A $3,200 unpaid invoice due on March 1, 2026, with a hearing on October 15, 2026 — that is 228 days.
$3,200 × 0.10 × (228 / 365) = $199.89 in pre-judgment interest.
Include this calculation on your complaint form as a separate line item. The judge will verify the math and may adjust the number of days based on the actual judgment date.
Adding Filing Fees and Court Costs to Your Judgment
Yes — if you prevail, the court can award you the filing fee and service of process costs on top of the judgment amount. Arizona's $5,000 small-claims limit is calculated exclusive of interest and costs, so you can claim up to $5,000 in damages plus interest and court costs.
Costs you can request:
- Court filing fee ($30 to $60 depending on county)
- Service of process costs (constable fee, process server fee, or certified mail postage)
- Witness subpoena fees ($12 per day plus mileage at $0.20 per mile)
Keep receipts for everything. At the hearing, present a simple expense log showing each cost, the date paid, and the receipt number.
Costs you generally cannot recover in small claims:
- Lost wages for attending the hearing
- Travel costs to the courthouse
- Time spent preparing your case
- Photocopying and document preparation costs (though some judges award small amounts at their discretion)
Requesting Interest on Your Complaint Form
When you fill out the Small Claims Complaint, include the interest claim as a separate line:
- Principal amount owed — the base debt
- Pre-judgment interest — calculated at the statutory or contractual rate from the date the debt became due, noted as "plus interest accruing at X% per A.R.S. § 44-1201 through the date of judgment"
- Court costs — filing fee and service costs (fill in as you incur them, or note "plus court costs" on the form)
The $5,000 small-claims limit applies to the principal claim, excluding interest and costs. If your principal damages exceed $5,000, you need to waive the excess or file in the regular civil division.
The Arizona Small Claims Filing Guide includes an expense tracker worksheet that walks through the interest calculation and cost documentation — everything organized for the complaint form and the hearing.
Get Your Free Arizona Small Claims Filing Checklist
Download the Arizona Small Claims Filing Checklist — a printable guide with checklists, scripts, and action plans you can start using today.