Unfortunately, small claims court isn't a viable option for everyone. For instance, you can't go to small claims court if you're trying to work out your financial affairs after a divorce.

In small claims court – or a local county or city courthouse that does not require legal representation to have a claim heard and decided by a judge – different rules apply according to state.

As a result, alternatives such as arbitration and small claims court have become popular ways of resolving these situations. The difference between arbitration and a lawsuit is primarily in formality.