Creditors have the possibility of filing a judgment against you if you fall behind on a debt. This means that the creditor will be granted authorization to pursue specific procedures to collect their debt from the court.
In essence, a creditor who has a judgment against you has more power and can use third-party collection methods to recover the money you owe, such as wage garnishment.
It can be terrifying to learn that you have a judgment against you or that a creditor is pursuing a judgment against you. Suddenly, you’ve gone from deferring payment on a debt to facing legal action as a result of that debt.
And, sadly, creditors can still get a judgment even if you tried to settle the obligation and were unable to do so due to circumstances beyond your control.
The good news is that there are a few steps you may take to avoid being judged. And, like with most things in life, the sooner you act, the better.
Ignoring a creditor’s notice that a judgment is being sought against you might make your situation much worse. If you don’t take action before the court date, the court will automatically grant the judgment – even if the debt isn’t valid – and you’ll be stuck with the repercussions.
What can you do to avoid being found guilty?
Set up a Payment Plan
Speaking with the creditor before they submit any court documents is one method for stopping a judgment against you.
Begin by describing your situation and requesting a payback schedule. Request that any arrangement is in writing, as well as documentation stating that the creditor will no longer pursue the judgment against you. If you’re dealing with a legitimate scenario, you’ll almost certainly be given a contract stating that no action will be done if you keep your end of the bargain.
Speaking with creditors without professional experience can be dangerous, as many will try to take advantage of you.
Dispute the Debt
If you believe the debt is not legitimate, you have the option of fighting it. You should never agree to pay a debt that you are not responsible for paying.
Bankruptcy is a legal term that refers to the process of declaring bankruptcy
The only way to protect oneself from a judgment is to declare bankruptcy. If you are unable to create a repayment plan and the debt is valid, this is the best alternative. Although most people think of bankruptcy as a last resort, depending on your financial situation, you may be better off filing before exhausting all other options.
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What can you do to avoid a judgment against you?
Arrange a Repayment Plan
One option you have for stopping a judgement against you is to speak to the creditor before they file any court documents.
Start by explaining your situation and asking if you can work out a repayment plan. Ask that any agreement be put in writing and that you also receive paperwork that states the creditor will no longer pursue the judgement against you. If you’re dealing with a legitimate situation, you’ll likely receive a contract concerning the agreement that states no action will be taken as long as you uphold your end of the contract.
Speaking to creditors without any professional experience can be risky because many of them are trying to take advantage of you. However, if you’re facing court-ordered wage garnishment, it’s better to give this option a try.
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When you’ve fallen behind on a debt, creditors have the option of filing for a judgement against you. This means the court will grant the creditor permission to take certain steps to collect their debt.
Essentially, a creditor with a judgement against you has more power and can pursue third-party methods of collection, such as wage garnishment, to collect the money you owe.
The thought of having a judgement against you or receiving notification that a creditor is pursuing a judgement can be frightening. Suddenly, you’ve gone from putting off a debt to having actual legal action taken against you regarding that debt.
And unfortunately, even if the debt was something you tried to pay and your inability to do so was out of your hands, creditors still have the option of getting a judgement.
The good news is there are a few things you can do to stop a judgement. And as is the case with most things, the sooner you take action the better.
Ignoring notification that a creditor is seeking a judgement against you can make your situation a lot worse. If the court date passes without you taking action, the court will automatically grant the judgement – even if the debt is not legitimate – and you’ll be forced to deal with the consequences.