What does post-judgment interest represent?

Post-judgment interest represents a monetary sum that accrues on a legal judgment after the court has ruled in favor of one party until the amount is fully paid. This interest serves several important purposes: it compensates the prevailing party for the time it takes to receive the awarded amount, ensures that the judgment retains its value in real terms over time (considering inflation), and encourages timely payment of judgments by debtors.

When a court issues a judgment, the prevailing party is usually entitled to the principal amount awarded, along with any interest that may accrue until that amount is paid in full. This mechanism is critical in providing an incentive for debtors to settle their obligations promptly. It is typically calculated at a statutory rate unless specified otherwise in the judgment itself.

Understanding post-judgment interest is essential for recognizing how financial obligations evolve after a court ruling and the implications for both creditors and debtors.