Interest rates are compensation for the time-value of money, and are calculated on judgments (the amount of money one party to a lawsuit is ordered to pay another party) based on the applicable state or federal statutes. There are often different interest rates set by law for prejudgment interest (the interest on the amount owed before the judgment) and post-judgment interest (the interest on the amount owed after the judgment). The calculation of prejudgment and post-judgment interest rates vary from state to state (and in federal court), and require a careful analysis of the statutes.

In Colorado, interest rates on judgments are governed by state statutes, which set forth different rates for prejudgment and post-judgment interest. Prejudgment interest is intended to compensate a party for the loss of use of money due to another party's wrongful conduct from the time of the injury or damage until the judgment is entered. The rate for prejudgment interest in Colorado is typically set at 8% per annum unless the parties have agreed to a different rate in a contract. Post-judgment interest is calculated from the date of the entry of the judgment until the judgment is paid. The post-judgment interest rate in Colorado is set by the state treasurer and can vary, but it is often lower than the prejudgment rate. The specific rate is determined based on the average federal discount rate plus 2%. It is important to consult the current statutes or an attorney to determine the exact interest rates applicable to a particular judgment, as these rates can change and may be subject to specific conditions or exceptions.