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 Washington State, interest rates on judgments are governed by state law. Prejudgment interest is the interest that accrues from the time the money is owed until a judgment is entered. Washington does not have a fixed statutory rate for prejudgment interest, and it is typically determined by the courts based on the circumstances of the case, often using the rate applicable to the contract or the judgment if no rate is specified. Post-judgment interest, on the other hand, is interest that accrues after the judgment has been entered. As of the knowledge cutoff in 2023, the post-judgment interest rate in Washington is set at a rate of 2 percent above the prime rate, as published by the Federal Reserve, with a minimum rate of 5 percent per annum. This rate is subject to change, so it is important to check the current rate at the time of the judgment. Both prejudgment and post-judgment interest rates are subject to the specifics of the relevant statutes and case law, and an attorney can provide guidance on the applicable rates for a particular case.