Colorado Post-Judgment Interest Rate: How 8% Accrues on Your Judgment

The moment a Colorado court enters a money judgment, interest starts accruing on the unpaid balance — whether the debtor pays next week or five years from now. Knowing the rate, the calculation method, and which costs you can add to the balance directly affects how much you ultimately recover.

The Standard Rate: 8% Per Year

Under C.R.S. § 5-12-102, post-judgment interest accrues at 8% per annum, compounded annually on the unpaid judgment balance. This is the default statutory rate unless the judgment specifies a different statutory rate or a higher contractual rate.

Interest compounds on the anniversary of the judgment entry date. Between anniversaries, it accrues as simple daily interest on the current balance.

Medical debt exception: Judgments arising from medical debt are capped at 3% per annum under C.R.S. § 5-12-102(5)(a).

How Payments Get Applied

When you receive a payment from the debtor — whether voluntary, through wage garnishment, or from a bank levy — the money gets allocated in a strict order:

1. Accrued interest first
2. Taxable enforcement costs second
3. Principal balance last

This allocation matters. A $1,500 payment on a $5,000 judgment with $414 in accrued interest and $75 in enforcement costs doesn't reduce the principal by $1,500. It clears the $414 interest, clears the $75 in costs, and puts the remaining $1,011 toward principal — leaving a $3,989 balance that starts accruing fresh interest.

What You Can Add to the Judgment Balance

Legitimate post-judgment enforcement costs are recoverable. You can add these to the total owed:

• Court filing fees for writs of garnishment and execution
• Transcript of Judgment fee ($25)
• Process server and sheriff service fees
• Sheriff execution deposits and advertising costs for public sales

What you cannot add: attorney fees (unless specifically awarded), private collection agency fees, legal research costs, administrative overhead, or any unapproved expense. Only verified, court-related enforcement costs go on the ledger.

A Practical Example

Judgment entered March 1, 2024 for $5,000 plus $100 in court costs:

After allocating the $1,500 payment (interest → costs → principal), the remaining principal is $4,089. Year 2 interest accrues on that reduced balance.

Why the Ledger Matters

An accurate running ledger protects you in two situations:

Garnishment disputes. If the debtor challenges a garnishment amount, your ledger proves the remaining balance. Without it, the court has no evidence to back your claim.

Over-collection risk. If you collect more than the total owed (principal + interest + costs), you're legally required to return the excess. A sloppy ledger can lead to over-garnishment, which creates liability.

Track every payment, every enforcement cost, and every interest accrual date. Apply payments in the correct order. Update the balance before filing each new enforcement action.

The Colorado Judgment Collection Guide includes a judgment balance ledger template with the interest calculation formulas and payment allocation built in, plus a fee schedule covering every enforcement action's court and service costs.

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