How to Settle Credit Card Debt with a Judgment
One of my credit cards I fell behind with sued me and has a judgment.
Can you settle credit card judgements like other debts
—Stressed
Short answer
Yes, a judgment can still be settled. Settlements can be negotiated at every stage of the collection cycle, but settling before a lawsuit is filed is easier and usually saves more.
Key points on this page
- Settlement is possible at any stage, including after a judgment has been entered.
- The largest savings usually come from settling with the original bank after a few missed payments.
- A judgment is enforced through bank levies, wage garnishment and liens on real property.
- Judgment balances keep growing at the interest rate set by the court, and most states allow a judgment to be renewed, often ten years plus another ten.
- Wage garnishment removes most of a creditor’s reason to negotiate, so act before it starts.
- If you cannot fund a settlement, bankruptcy can stop a levy, a garnishment or a lien.
The short answer to your question is – YES! CRN does assist in settling debts like credit cards where there was a lawsuit and then a judgment entered against you. Settlements can be negotiated at all stages of the collection cycle.
There are challenges to settling credit card debts that have reached the lawsuit and judgment stage. Before I address the challenges, I want to point out that the best time to settle credit card debts is before a lawsuit is filed, and even before the account is placed with a debt collection attorney.
Watch my brief video about some of the differences between settling credit card debts with your bank and debt collectors compared to negotiating with collection attorneys whether they have a judgment or not.
While this may not be instructive to your judgment debt, you may have additional credit card debts that have gone unpaid and I want you to be aware of the following:
- Settling a debt with your original creditor (the bank you had the credit card with) after having missed a few payments is not only possible, but in your best interest. In fact, reaching settlement early will often achieve the best savings result when negotiating is done correctly.
- You may end up with credit cards that are charged off and placed with outside collection companies. This is the next best (sometimes the best) opportunity to settle a credit card account you could no longer afford to keep payments current.
- If your overdue credit card account lands in a collection attorney’s office, you can still settle the debt before any court action is filed, or at a minimum, negotiate favorable payment terms.
There is a science to navigating the collection stages I briefly outlined above. Timing, balances, who your credit card debts are owed to, and your ability to come up with the money needed to settle the debts – all will affect the strategic design of which account to settle with first, second, third etc…. It is important to have a plan to follow if you want to systematically and successfully settle debts and save the most money in the process. CRN is excellent in assisting people in this regard.
If you want to learn about how to settle your debts no matter what stage of collection you are in, we have a ton of resource pages to help you. I recommend starting at the beginning of my debt settlement section.
If you are floating out there with several unpaid credit card accounts with no real financial resources to handle the situation, or a plan for doing so, you owe it to yourself to learn if you would be better off filing for chapter 7 or chapter 13 bankruptcy before a lawsuit is filed, or now that a judgment exists. You can consult with a bankruptcy attorney for free. I recommend talking with more than one.
Collecting on credit card judgments can be challenging too.
The primary ingredient found in any debt settlement recipe, whether there is a judgment or not is… money. If you have enough of this ingredient you need to be aware of a few things.
A judgment is just a piece of paper. It’s the court sponsored enforcement of that piece of paper that is the problem. You could end up with liens placed against your real property, your bank account levied and wages garnished directly from your employer. There are even instances where a sheriff can show up to take a look around at your “stuff” and inventory personal items that can be taken to satisfy a judgment (this happens, but relatively rarely).
Judgment debt, whether past due credit card bills, personal loans, medical bills and other debts, are easier to negotiate and settle while maximizing your percentage of savings results if:
- A bank account to levy cannot be found because one in your name does not exist, or does exist but is maintained with little money in it;
- If a W-2 wage source cannot be located to garnish and;
- Where there is no real property lien, or where the lien is filed, but has been in place for some time and remains unpaid.
The one thing you can control is whether you have a bank account with your name attached. If you do keep a bank account open, realize most bank levies are attempted at the beginning, middle and end of the month – when you are most likely to have deposited a pay check, or other money to cover bills.
If you have sources of funds electronically deposited, you may want to elect to have paper checks issued to you until the credit card judgment debt is resolved.
The lien on property will generally not involve forcing the sale of the property in order to satisfy the judgment. You should look to resolve the judgment prior to selling the home (negotiate a settlement before listing if possible), or refinancing (settling before a lender does a hard credit pull is often best).
Wage garnishment is a major concern. Once your wages are attached the creditor has little reason to work with you at resolving the debt for less because they will continue to get paid unless:
- You prove you meet garnishment exemptions in your state
- You leave that job
- You satisfy the judgment
Warning: Your credit card judgment debt grows from interest and can often be renewed!
Interest is accumulated at the rate set by the court, or the maximum allowed by law in your state for judgment debt. While you may be able to be creative in how you avoid paying the judgment you must realize that the balance of the judgment is likely increasing.
If you are struggling with overdue bills and other expenses and are unable to come up with a plan to get rid of the judgment or lawsuit through a negotiated settlement or payment terms you can afford, the fact that the debt is increasing should concern you. Stop and consider what your options to resolve the credit card judgment will look like next year. The year after that.
Judgments do have a “best collected by” date, but can be renewed. Judgments have a shelf life with a time frame specific to your state. Most states allow for a judgment to be renewed prior to expiration. For many, this is a ten year time line and renewal allows for an additional 10 years. That’s a 20 year shelf life!
Identify all resources you can tap to fund a settlement offer or payment plan successfully. If you cannot reasonably come up with the money to settle the debt, or make payments after reaching agreeable terms, look to bankruptcy to stop a bank levy, wage garnishment or lien on property.
Those are the unfortunate realities.
I highly recommend anyone with a judgment, that needs to be resolved in order to buy or refinance your home, to watch this video interview I had with a former debt collector: https://youtube/QpdDks73QUw
It is always best to put a plan together to address delinquent debts before a judgment becomes the concern and you are forced into crisis mode. If you have other debts, you can still put a plan together that includes resolving the judgment too, but it is important to not waste any time in doing so.
Need some personalized help?
If you would like confidential help you can use any of the boxes below to connect with me. You can also post in the comments below for feedback. I answer those regularly.
Not sure where to start? Click on the big blue “Get Debt Help” button at the top of the page.
About Michael BoveeMichael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked as an expert witness in court matters related to the debt relief industry. He is available to speak with you about your financial struggle and helps people resolve their debt problems daily.
Hi,
Back in 2006, I cosigned a semester’s tuition for a friend’s younger sister who was an international student for $20,000. To cut the story short, she paid the interest for about a couple of year but did not pay down the principal. the worst part now is that she has returned back to her country without even finishing her education. I live in MD, but the school was the St Louis University in MO. The school has charged the debt off and I have received many notices from different collection companies that I ignored as there is no means for me to pay it back. a couple was even offering 40% discount on the loan. It was also reported to the credit bureaus in 2010 and reduced my credit score by 60 points. Please note that I constantly call my friend to get him to repay the loan, but his response is always that he is working on it. Fortunately, I still have good credit and was just going to wait for the 7 years SOL. However, I received a notice yesterday from a law office in Baltimore that I need to contact them within 30 days to discuss the loan or they will start a legal debt collection process. I just bought a house (with a slightly, but still affordable interest rate) that I will be closing on in a couple of weeks and I know I can’t afford either a wage garnishment or judgement on my bank account. I am a married father and can not afford to pay more that $100 a month until my friend pays this loan back. The total loan now is $22,500.
I will gladly appreciate any advice on this issue.
Thanks for your assistance
Lexy
If I were in your shoes I would be most worried about anything new upsetting the apple cart with your home loan going through (the fact the student loan is in collection and showing on your reports now could still hold you up longer).
I would first talk over your scenario with an experienced debt defense attorney in Maryland. While discussing the issue, bring out the pending home loan, and if they can help with a legitimate strategy to delay any collection progression until you know how that shakes out.
I can help you locate an attorney with the experience you need, and who may already know the attorney collecting, as a result of other case work. What is the name of a large city near you?
Thanks Mike for your quick response.
Please note that I have not been sued yet. What I received was a notice from the lawyers to contact their office in order to ‘mediate this matter and discuss alternativs that are reasonable to both parties. I just need an advise on what to tell them during the negotiation and mediation talk.
My loan (consigned with my wife) will close next week. I just hoped that nothing will show up on my credit before then.
The closest cities around me are Washington DC, Hyattsville MD, Greenbelt MD, and Largo MD.
Thanks Again for your assistance.
Lexy
Got it.
I sent you some attorney contact info. You can likely consult initially at no cost.
Best of luck in the new place!
Thanks,
I will give them a call soon.
Regards
Lexy
My employer just received a writ of garnishment from an attorney. It says I had a judgment against me in Feb. 2003 from Discover card. The original amount was a little over $5000. With a 19.8% interest rate, I now owe over $14, 000. I do not remember this judgment, so I called the county clerk’s office and they verified the judgment and that it was served to my now ex-husband. So I understand it was served properly according to NM law, even if I never personally received it. I have been diligently monitoring and working on my credit since my divorce in 2007 and I don’t remember ever seeing the collection or the judgment on my credit reports. After 7 years of working on my credit to buy a house, the last thing I want is a wage garnishment showing up on my credit file. There is no way I can come up with a lump sum, and I don’t see why they would accept a small monthly payment that I can afford when they have the writ to garnish 25% of my wages. I barely live paycheck to paycheck as it is, taking that much money out of my checks would kill me. I don’t know what to do. Is it unreasonable to try to negotiate a settlement for the original amount owed less the ridiculous interest charges? And will this show up on my credit? Can they take money from my bank account without notifying me first?
The wage garnishment would be unlikely to show up. But an unpaid judgment will likely prevent you from financing a home.
You are correct that small and manageable monthly payments on a debt like this are not common. And that direction also does not help you reach your goal of purchasing a home either. You want the court record to reflect a satisfied judgment. You get to that point by negotiating a pay off.
Lets assume for a moment they will settle for 7k. How long will it take you to put that amount of money together?
Yes, your bank account is likely at risk. What state are you in?
I am in New Mexico. 7k is not even remotely possible in the near future. Put it this way, I live paycheck to paycheck with almost nothing left over. I have $500 in my savings account. And I only have that because of a year end bonus. I am up to my eyeballs in debt, but proudly paying everything on time for the past 7 years only to have this come up and bite me. So can they just take the money from my bank account, without any notice?
As long as you are not claiming other judgment collection exemptions (car value, homestead), New Mexico could protect several thousand dollars in your bank account.
Have you looked into chapter 7 bankruptcy?
I know you are proud of managing things up to now, but gutting it out from here may not make sense. Not if they can make the garnishment stick.
Chapter 7 bankruptcy could eliminate this judgment, and many other debts you may have. You will only be putting your home ownership goals on hold for roughly 2 years (fha financing is possible with a good debt to income ratio in as little as 2 years after filing chapter 7). You may not qualify for a mortgage now, even without the judgment, if you are living so tightly from one paycheck to the next.
I don’t think chapter 7 is for me based on income first and I don’t think I can bring myself to ruin my credit that way. If I was going to do that I should’ve done it 7 years ago. Without the judgment I should qualify for a mortgage because the main reason I’m living so tightly right now is because my rent is ridiculously high. Anyway, thank you for your help.
I called the attorney and they agreed to $7000, which I was able to borrow. The thing is, they won’t give me a letter until the funds are received. I have read time and time again not to pay until it is in writing but they say this is how they do it. They put it in their system for a due date a few days away, when the funds are received, they send a release of garnishment and a settlement letter to me and my employer and a satisfaction of judgment to the courts. I tried insisting on a letter, but no go. What is your advice here? Is there any protection if I do pay and they go back on the verbal agreement?
Yes, there are some protections, with New Mexico regulators and also the CFPB. But I would encourage you to call them and go over the details they are agreeing to with payment etc., all over again. Only this time, record the call. Let them know you are recording and why. It should not be a problem.
Keep that recording safe until all of this is handled, and then keep it still.
Nice work!
Thank you so much for all the help you provide to everyone!
I am being sued by Citibank for 8500.00. I don’t remember ever dealing with them but I got a divorce in 2005 and that is when they said I owe them. They sold the loan in 2008 to a collection agency. I received a summons to court for Feb 9th 2015. I live in Tennessee, can I ask them for proof of debit and use time barred as a defense?
The dates you gave are not clear, but it appears you would have a time barred/SOL defense based on what you shared.
I would encourage you to call an experienced debt defense attorney in TN. If you like, I can send you a referral or three who all offer no cost initial consults.
Yes please do. thank you
Hi Michael!
I’m in CA, in Nov. 2014 I saw on my credit report that I have a judgement from a collection agency entered 03/2013 .
It must be from an old Citi credit card, I called Citi and they said it was sold to Asset Acceptance on 12/2010 and gave me a number to call, when I called I was told it’s now with with Midland.
I was never served and credit card debt was last paid around 2008-09. How can I have a judgement without my knowledge? Can I be sued if it’s pass the SOL?
I’ve contacted 2 attorneys here in Southern CA, 1 wasn’t taking new clients due to his overwhelming schedule, but he did refer me to another attorney…I’ve emailed her and left messages, but haven’t heard back.
I’ve contacted Midland to settle, judgement says $3305…I offered to settle with $1700 and they won’t accept it.
I looked at my credit report print out today and noticed that the Citi accounts showing in my report shows settled and the other in good standings.
It’s been so long, that I don’t know if this is even accurate. I did notice an address and employment in my credit report that is not familiar at all.
Help! I really don’t know what else I can do about this?
Thanks in advance.
M.
Contact the attorney I am going to email you information for. He has a good deal of experience getting judgments vacated when you were not served etc. Let me know how it goes.
Hi Michael – Thank you so much for your very informative videos. I am in NJ and being sued for $6,400 by a law firm representing Discover Card. My understanding is that at this point in the process, 15%-35% is the range that a creditor will accept to settle the case. I have offered them $1,000 (16%) and they came back with an offer of $5,200 (81%). I am simultaneously negotiating settlements with other credit cards for much larger amounts and have found some making an initial offer of 35%. Besides another Discover Card account for which I’m also being sued, I have found the other creditors more willing to negotiate, for smaller percentages, and no lawsuits yet. I’m guessing that Discover Card has chosen to be more aggressive in its collection attempts.
1) I did not expect Discover to accept my initial offer, but expect quite a bit of back and forth. I’d like to keep a settlement to 20%. How realistic is that?
Obviously, Discover’s lawyers are using the threat of a court case as leverage to get me to pay. I have explained that I have no money and no job, but I have been offered a loan of $1,000 which I can use for a settlement, contingent upon settling this case in full. Surely they know that even if they win the case (which seems extremely likely to me), it will be difficult to collect anything from me. I see this as a game of “chicken” where they expect me to pay as the court date becomes closer.
A week or so after my settlement phone call with them, they sent me a “discovery” questionnaire, followed by a letter informing me that a judgement for the full $6,400 plus court costs had been entered in the court on December 9, 2014, plus a copy of a request for adjournment of the case for another 2 months because they need more time for discovery. I have since confirmed with the court that they have been granted that adjournment until March.
2) I had returned my answer to the complaint by December 8 (the deadline) and have documentation proving it. I have checked with the court and as I assumed, no judgement has been entered against me. Is this bogus letter claiming a judgement something for which I can sue under the Fair Debt Collection Practices Act?
3) The discovery questionnaire (Interrogatories and Request for Admissions) contains many questions which, if answered, will force me to lose a court case. What is my legal obligation in answering these questions and confirming their charges? It would seem filling out these forms would make a court case unnecessary.
Thank you so much for your help.
1. Getting Discover to settle for 20 percent of the balance owed is not realistic. You would have to double that to get closer to where I see Discover collections in the courts get settled at the lowest end. If you appear more collectible to the attorney, negotiating for more than 50% is common.
2. Get some feedback about pursuing any FDCPA claim (using state or federal laws), from an experienced debt defense attorney that practices in your courts. I can help you locate one that will usually offer a no cost initial consult. Post the name of a nearby larger city and I will email you contact details.
3. Filling out interrogatories, and participating in discovery for the most part, can be an art form. Admitting in part, or denying certain admissions that seem obvious, is helpful. This is also something to run by an attorney.
If your goal is settling, and you need time to pull together more resources, you can sometimes use the court process to draw things out (a year is not unheard of).
Michael, thanks so much for the extremely helpful info. I would appreciate your recommendation of a debt defense attorney in NJ… nearby cities are Plainfield, and Somerville. I’m in central NJ.
You mentioned the realistic settlement percentage for Discover (at least 40%). I’m also dealing with Bank of America, Chase, and Citibank. Do you have settlement estimates for any of them?
Check out this post for more about realistic percentage settlement targets for all of the larger bank issuing credit cards that you have. Those numbers are still fairly consistent today. I do see some limited exceptions still, with BofA and Chase settling for under 30 percent. Chase more when they have the account placed with an outside agency.
I sent you an email with contact details for the nearest experienced debt defense attorney I know of. I can offer several more east of you if you need it.
Hi Michael:
Thanks for the lawyer referral. I have called that law firm and left a voicemail. Hopefully, they’ll call back (I’ve previously called 2 law firms (not referred by you) and failed to get a response. With the firm you referred, I let them know you referred me (I don’t know if that helps you) and will mention it again if/when I speak to a live person there.
1) Just in case, could you send me the other central NJ lawyer referrals you mentioned?
2) 30 days from the date of the interrogatories I received is this Saturday (Jan. 10), though I may have a few days more because of holidays. What happens if I don’t return the forms on time? I received them by regular mail, so I don’t see how there is proof of the date. (In contrast, I received interrogatories from a firm representing my 2nd Discover account by regular mail a week or two ago, and today, by certified mail.)
3) I read the page you recommended: https://consumerrecoverynetwork.com/review-top-7-credit-card-lenders-best-offering-debt-relief/
and it concurs with my experience so far with Discover, B of A, Citibank and Chase. But your info was for pre-charge-off settlements. Mine are all post-charge-off. How does that change things?
Thanks so much for your help.
You can mention, or not mention you were referred by visiting and participating here. There is nothing in it for me.
I sent you an email with a larger resource you can use for legal help.
You should get your court timeline questions answered by someone in your state.
Your post charge off goals are going to be roughly the same. As you point out, because post charge off credit card debts are most commonly settled with third parties, if I knew the name of a debt collector, or debt buyer – trying to collect on a specific account – I could then adjust my targets accordingly..
Michael,
I have a outstanding debt with Discover card. Originally they filed judgement and won. I have been making payments through the local Sheriff’s office according to an agreed payment plan after the judgement was awarded. However, in July ’14 I lost my job and I haven’t made a payment since. Current total of the debt is $6,054. Now the law office that originally sued has contacted me about settlement. I’m still unemployed and have nothing to bargain with for settlement, but will attempt to make new payment arrangements. Any suggestions? If I just don’t pay, what possible repercussions might I face in South Carolina?
Thanks,
Jonathan
How much can you afford to pay toward the judgment monthly, and with total confidence?
What is the interest rate attached to the judgment (if any)?
If you cannot settle or make payments on the judgment, there are extra ordinary collection efforts available to judgment creditors, but that are determined by state law.
Wages (when you get back to work) are exempt from garnishment in South Carolina.
If you own your car, the value up to 5,625 dollars is protected, and there is a wild card that could double how much of your car is protected if you do not need to claim other exemptions.
Roughly 56k of equity in your home is protected from creditors in SC.
Your household goods are protected up to 4500 dollars in value,and there is a wild car here that could double the exemptions, but only when other exemptions are not used.
Cash in your bank account is protected up to 5625 dollars if you do not claim a homestead exemption, and there may be other considerations to how a court would figure out how creditors should be prevented from placing a levy on your bank account.
If I had a judgment against me and have been making scheduled payments to the Court Officer for the past two years, can I receive a letter from another law firm for the remaining amount of debt still owed? I have completed on time payments to a Court Officer for the past two years to pay off a debt owed to a creditor. I have now received a letter from another law office for the amount left to be paid off. Can this happen? Do I need to contact the Court Office and see if this is legal?
Judgment debts do get sold, and judgment creditors will also terminate and start new attorney relationships from time to time. Both are possibilities for what happened here. Yes, I would definitely call the court office. I would also call the attorney trying to collect in order to get to the bottom of what is happening.
Post an update with what you learn.
Hello,
Michael
I have this judgment from capital one for $2,225.00; the judgment was from 10/6/2009. Question in Ohio a judgment can be renewed every 5 years. If I responded to the court or ask to vacate it does renewal need to be made by the plaintiff or do they need to file for renewal? The only motion made was by me to vacate but was not renewed so does this happen automatically? The plaintiffs have not collected one red cent, which of course may open the door for some kind of settlement since as of date I am “judgment prof ” with no assets to collect or garnish. Thank you once again for your comment!
I would encourage you to speak with an experienced debt defense attorney in Ohio. I can email you contact info to some if you like. Post the name of a nearby larger city.
My understanding is that the judgment creditor must move the court for the renewal. Your efforts to void or vacate the judgment would not affect that.
Many judgment creditors, in my experience, do accept lower settlement offers the longer the judgment has gone without payment. Capital One rarely settles for less than 50%, at least, right now.
Hi Michael,
Thank you for all of the time you spend on this. It really is a great reference. My situation is similar to Keith’s. I have a default judgement in Toledo, Oh, in July 2014, Unifund attorney David Bader. The original debt was acquired from Citibank, appox $7500. I moved and thus was not aware of the proceedings. I’m unemployed and have no assets (2003 car). They have proceeded with bank garnishment–very little funds. Do I try to vacate the judgement or settle? Do you have any contacts in Toledo? Have you had any experience with the law firm of David Bader? I’m just not sure how to proceed.
I do not recall any files that involved Bader as attorney for the collector, but I have plenty of experience with Unifund files. You will have to really work to accomplish any of your goals with Unifund. It could cost far less to work with an attorney to vacate the judgment than to settle. But call one or both of the attorneys in the email I sent you. Share the details of your situation and see if vacating the judgment has a reasonable chance of success, and what the costs will be. Post an update with how you progress, or if you learn something that suggests settling is a better path to take.
Hey Michael-
I was recently hit with wage garnishments from a previous judgment that totals 4,706.88. My employer was notified and was preparing to garnish my wages….well at the same time my contract with my previous employer ended and I left that company. Does the debt collector(J&H LLC) need to file again to enforce wage garnishments from my new employer? I also contacted the debt collector and he did not seem like he was willing to negotiate a lump sum payment? Is this something that I should continue to pursue? I can offer close to 2,000.
They will have to track you down and attempt garnishment all over again with your new employer.
Not all judgment debts will settle, or for the same amount of savings.
Tell me more about the specifics, like the type of debt; name of plaintiff that sued; when you last paid on the debt; the date the judgment was entered.
Do your credit reports show you are paying other creditors on time? Are there other collections showing on your credit?
It is a credit card debt; J & H LLC is the plaintiff; last payment was June 10, 2010; the judgement date is August 20, 2014.
The other issue is that because I pay a child support that is larger then the allowed state minimum for garnishment…on the non exempt earnings statement reads that they can garnish from the amount of $0…does this mean that they won’t be able to garnish because i do not make more then the exempt minimum?
I owe a total of $295 for a medical bill but that will be paid by the end of January 2015.
It does sound like they would get nothing from trying to garnish. They have other ways to try to collect. What state do you live in?
The judgment being only a few months old is one of the likelier reasons why they will not accept all that much of a deal through settlement. Once they learn they cannot garnish (if that is indeed the case), and other methods of collecting turn up little to nothing, they may become more reasonable about settling.
arizona
Arizona protects your vehicle value up to 6k.
Home equity up to 150k is protected from your judgment creditor in AZ.
Up to 4k of your household stuff is protected from the collectors trying to get you to pay a judgment in your state.
Your bank account in Arizona is only protected up to 300 dollars. This is likely where most folks with unpaid judgment debts in Arizona have to be concerned.
You will need to navigate the fact that your bank account is at risk until you work all of this out. That may mean cashing paychecks rather than depositing them. Paying bills with money orders. Doing much of your banking through a family members account that you are not on (wife, mother, brother, etc).
This Judgment was filed July 25th 2007. I would I know if they renewed it or not? I still see it on my court records.
Thanks for taking the time to answer my questions.
You can look up the most recent filings in the court records. You can also call the court clerk and ask if the judgment has been renewed and when.
Hi Michael , I just got served a civil summons from Guglielmo & Associates in Tuscon AZ . They are looking to get a judgement against me from Discover . I have been given 20 days to respond .The amount they say owed is $8,000 . The next day I get a letter to call them for a possible settlement . I do, And the best they offer me is $5,800 in 5 payments . When I asked about it being wiped from my credit , they said that would be up to Discover . Michael , I personally don’t feel like this is a fair NEGOTIATION . I can pay up to $4k in full but they want $5,800 . I’m disabled , and own my car , other than that , nothing but my personal property .I just feel like throwing up my hands and letting them have the judgement . I know they can’t touch my disability , but I am concerned about my vehicle , and them coming to my boyfriends house and taking my personal property . Any advice Michael ?? Can they take my vehicle after a judgement ? And if so should I transfer it to my boyfriend before the judgement ? And CAN they get a warrant to enter and remove items from my boyfriends house on the judgements behalf?? I’d like to settle in cash right now,,,,,,but they want more than I can give , and will STILL proceed with the judgement,,,,,,,,,,,,,what’s the point in paying then ?? I just feel like giving up.
Arizona protects up to 6 thousand dollars of vehicle value form judgment creditors. How much is your car worth?
You can protect up to 4 thousand dollars value of your household goods. And the usual stuff, like a fridge, washer and dryer, etc., sound like they are your boy friends. I do not see much risk to your stuff.
Are you permanently disabled?
Have you considered answering the complaint and defending the case to see if that helps Guglielmo become more reasonable?
The Law Firm is Bray and Lunsford PA.
I closed last week on my Refinance since my house since It is homestead. But I inherited a house from my Grandfather and I will not be able to sell this house in the future if I don’t get this matter cleared up. The only way I found out about this is from the Title company . The court papers where sent to old address. This matter is No longer on my Credit report since its been more than 7 years. Is the best way to handle this Sending a letter to the Law firm ? and if so how do I offer a settlement of $5000.00 ? If I Send an offer and they Deny it can they come back after me and my bank acct for the whole amount with interst? thanks again for your help.
You contacting them on the phone, or in writing, in order to settle, is not going to afford them any extra collection rights or amounts. Because they already have a judgment, they can come at you with any extra ordinary collection efforts allowed for in your state. Here are some of your exemptions in Florida.
You are on the hook for the judgment amount plus interest as it is.
I like your chances of settling for a significant savings because:
All these years have gone by and they have not collected.
Your refi went through, so your credit report is not a leverage point.
I would not tell them about anything other than the fact that you had forgotten about it until it was brought up in your recent refinance. You would liek to handle the debt, but only if able to settle, and for the amount you can pull together from friendly resources.
You do not have to get the deal done in one phone call or letter. And be sure you get the agreement to settle in writing before making any payment.
Judgments are renewable at 7 years in Florida. Did you look at the court record recently to be sure that they renewed it? Check for that before you do anything.
I have a Secure Judgment against me from 2004 from a Capital One Credit Card. I live in Florida. I was unable to work after having my two children and was unable to pay on my Credit Card the credit limit was only $1,000.00 . I went to court over this case Not know then that in 2007 they where granted a secure judgment against me. Since then I have built up my credit and working full time. My question is can I request to Re Settle this Judgment ?? The amount was $3798.00 plus taxes and fees totaling $5,000.00 but since I did not know about this til I refinance my house this year I now Owe over $13,000.00 my interest is 11% per year on the $5000. I don’t have that kind of money but I want to get this Judgment off my Court Records is there any why to request a new settlement with them to pay and remove this from my Court Records? I’m willing to pay off the $5,000. Can they come after me for this money again if I send them a Settlement letter since its been since 2007. I’m the only one working at this time and cant afford for them to take any of my money.
You can settle the judgment debt, and maybe for the 5k on hand. But you will not be able to pay to have anything from the court removed from your credit report. You can get the court record updated to show the judgment is settled/satisfied. And that by itself can clear you for the home refinance.
Who is the collection law firm handling this for Capital One?
Michael
First I want to thank you for the great work you do. I have some questions I need your extensive experience to help me resolve.
a) American General sued and obtained judgement on a debt(now $13,500 with interest originally $6,300) back in 2011. Ended up moving to Texas.
b) They sold the debt to LVNV and up till now I have not attempted to resolve the debt with them.
c) Recently got an offer to settle the debt with a CA (Delta Outsourcing group). They offered $5,700 but i’m a little concerned whether they will update my credit report since LVNV and not them are on my report. Also is it ok to accept an emailed settlement offer or stick to my request for a written one. Can I settle with anyone other than LVNV or is it ok to settle with this CA that just agreed to this settlement? Thanks
LVNV regularly uses outside collection agencies like Delta Outsourcing Group to collect on accounts. If you want to be certain of the right collector to pay, I would call LVNV and verify they placed the debt with Delta Outsourcing, and then proceed.
Is the settlement offer letter you received from Delta in the email sent as an attachment, or a message in the body of the email?
I have called resurgent(LVNV) and they indicate they placed it with InvestiNet. I dont know why Delta Outsourcing is offering me a settlement but won’t send me any paperwork from InvestiNet. Also the settlement is within the body of the email but has the letterhead too. Seems like they scanned the letter into the body of the email. Should I also ask for them to specifically delete form Credit report?
You can ask, but it is not likely going to be deleted. And any judgment showing on your credit is the result of the public record, which only be changed through the court.
The goal would be to have the information reflect accurately after the settlement. Resurgent Capital and LVNV regularly update credit reports to show an account has been resolved and zero balance now owed. Wait at least 30 days after you pay a settlement to be sure your credit reports are updated.
You want the court updated, and I personally prefer to have the debt owner file the satisfaction of judgment with the court. But you can motion the court with the satisfaction too. I recommend working with an attorney of your own for that (if need be).
Hello, Michael
I contacted the firm you recommended had meeting and will let you know if and when there is an outcome.
I feel the attorney has good understanding of the matter and fee structure.
Thanks again!
Hello, Michael
I found
Contact Staton, Fisher & Conboy L.L.P. in Huber Heights Ohio.
Do you know them and would you recommend this firm or from your list? Do you know of another better suited?
Thank you for checking.
I do not know them from Adam. And I mean no harm when I say I would not hire an attorney with the last name Conboy.
Hello,Michael
I came across your site after exhausting all my resources that I can possibly do without the assistance of a lawyer and without all the costs. I will try to keep this short but will need to explain the situation.
For years going back to 2004 I was displaced and forced to move from my place of residence against my will in a type of eminent domain case(can explain later)
This caused numerous problems financially and emotionally to numerous to mention. Later I finally found permanent residency.
During this time of these extenuating circumstances Capital one credit card filed for judgment on October 6, 2009 for $2,255.73 for a credit card that had only a $1000.00 dollar limit! At the time I believed it was paid but not sure with all the turmoil from the displacement. I was not aware of the summons and never received it and found out later doing a public records request back in April of this year which is nearly 5 years later finding this out that there was a judgment against me. If i remember correctly I had a balance of a little over $700.00 dollars and have tried to fight the judgment. they have invaded my privacy by going into bank accounts that had no monies, nothing to garnish, I have no assets or anything I own and scant odd jobs to feed myself. Also to compound matters my spouse is on unpaid leave compounding the matter since I am fighting the judgment. I made a motion to vacate judgment, however, I never received any of the paper work to defend against the judgment and made 2 motion one to vacate and one for amended motion on my own. I went to court and they refused to give me copies of the paper work. I was denied from putting a full defense against the judgment and was given the magistrate and not the judge on the case. I was denied my motion as would be expected. I then wrote letters to Capital one from the public records and the attorney Javitch, Block, and Rathbone out of Cleveland, Ohio specifically Brian C. Block the actual attorney in charge of the case. Naturally I have been ignored by them. I did request validation and asked for all statements, and for my signed signature binding me to the contract which the only paper I received was the judgment plus the fees, interest of 28% and the court cost ballooning into over $6,026.49 dollars by a piece of paper sent to me by them with their file number and words at the bottom “This is a communication from a debt collector”. I am assuming they represent Capital One or they sold it to them( cant be sure at this time). I did try to file another motion to vacate on grounds of misconduct by the court because I was denied my due process in the first place and not having the paper work from the court. It has been since August 2 of this year and there remains an open motion of over 90 days and they refuse to answer my motion. I would of tried to settle something but am not going to be subjected like this with these greedy corporations and attorneys.
I have some options one of course would be bankruptcy but would rather avoid the headaches of another court and vacate the judgment with a reasonable settlement but they have not provided my signed signature. I understand the account was opened in September of 2000 but I still do not have all the paper work from this, and this is old and needs to end. From reading from the your blog Capital one is known to do these things to people with no consideration of circumstance and I am not going to even start with any payments; I have no retirement, left in limbo with no way out except that I am tired and wiped out in many ways. I could also just not do anything but this has gone so far and would hope you can help or if you cannot find someone that can assist in this kind of matter. With a balance of just a little over $700.00 dollars at the time it certainly will be obvious that there is not going to be any settlement over $1000.00. Bankruptcy will cost even more.
I have been harmed for years and need to be free of this. I do have all the paperwork finally by requesting the court according to Ohio revised code 143.43 to force the court to provide it. I would like to do it the same to the attorney keeping the records of the account and the case but feel it would be best to hire someone as I did send a notice of presentment under notary seal to have them cease and desist their actions against me.
Thank you for reading and your assistance in helping steer this in the direction that is needed and can give the details to the paperwork regarding this matter to follow up further.
Based on what you shared, and depending on what your ultimate goal is:
You can settle this with the Javitch, Block, and Rathbone, but probably not for the 1k you suggested would be an option for you.
You can discharge this debt in chapter 7 bankruptcy and tell them all to pound sand. But if it is the only debt you have, or that concerns you the most (due to the options they now have to collect on a judgment), It is almost not worth that.
You can continue the legal fight, and there are issues from what you shared. But you need an attorney. Did you ever connect with low income legal aid in your area? It sounds like you would qualify for low/no cost assistance.
Thank you Michael for the response to the matter. I contacted legal aid very unhelpful and doubt I would use them for anything after the gentrification that took place here in Ohio locally; officials here are very corrupt and everyone wants to get something from the disadvantaged;the courts favor in biased against individuals. bottom line is it will be an up hill battle, but would like to fight it out in court as this debt is now the priority. The other problem as reading your blog is even if I could settle with them they could send a 1099-c for the difference and I will still have a problem with shifting it to the IRS;how would that work? Can you still wipe that out in bankruptcy? Would it just create another problem indirectly from the debt? I am assuming it is and can answer my own question. The IRS could come back on me for debt becoming income and not reporting taxes to pay but if a person does not have funds it would be insane anyway.
I should also should mention that I did get a debt collector from another account that was decades old and they tried to harass me for years and finally they dismissed it after I sent the notice of claim of the presentment under notary seal, however it might be possible they to might send a 1099-c so yes I would like to consult with an attorney that could assist in my situation before this gets any worse. Do you have any suggestions of a good consumer protection advocate attorney that would be suited in m my area and my situation and do this at no or low cost? Is this possible? I should not be punished for 8 or 10 years with a bankruptcy on my record; I would like to at least try to stop them in their tracks.
I may wait till tax time to make sure their are no 1099-c sent to me which would present a huge problem. Also if I would receive a 1099 from work done with odd jobs they would go after that but not sure how that would work since I am way below any standard poverty line anyway? Bottom line is bad misfortunes happen to good people.
Thank you once again for your help as my life remains on hold until this matter is resolved.
Forgiven debt that is the result of legal discharge from bankruptcy is not taxed.
Not all people settling debt, or with forgiven debt, end up paying taxes (or the full amount). If you owe more than you own, you can avoid the tax. More detail on that can be found here.
I can help you locate experienced consumer law attorneys to speak with. All of whom likely offer a no cost initial consult. Are you in the Cleveland area, or just post the name of a nearby larger city.
I am in the Dayton Ohio. I ran across an attorney just yesterday in Huber heights but cannot find it again today.
I still want to fight them but will an attorney do this for no or low fee given my situation with javitch, block and rathbone with the Capital One Credit card.
I sent you an email to two experienced debt defense attorneys in Dayton. They both offer no cost consults in most instances like yours. But neither is likely to work pro bono. There fees would have to work for you, or it wont make sense to retain them.
Hello, I am in need for some advice immediately.
I received a letter yesterday from Midland LLC stating that my wages will be garnished. I immediately wen to the court house to see what was going on considering this is the first letter that I have received concerning this situation. I decided to do some research and found that this credit card debt is 14 years old. My account closed on October 31,2005. After speaking with the court associates they stated that the lawyer renewed the garnishment. What should I do now? I am a single parent that works a part-time job and attends college. I can not afford to pay garnishments. Please Help!
What state are you in?
I would recommend you consult with an experienced consumer attorney about your options, starting with trying to locate a low income legal aid office in or near your city.
If this judgment is really old, but was renewed (as can often occur), the debt is not going anywhere. You will have to put together a plan to tackle this. But you may be able to do that more on your terms,at least right now, as it sounds like you may be partially ro fully exempt from garnishment.
Hi Michael,
I have two credit card debts dating back to 2009 which was before I was laid off from my job. Long story short I was taken to court by a junk debt buyer/law firm (Blatt, Hassenmiller, Liebsker & Moore) in 2010 and I got both cases dismissed without prejudice. I knew they could come back and bite me but I always figured I’d be served by a Sheriff like the first time so I’d have some warning.
I was wrong. I had never heard of sewer service before. Come to find out that I was “served” last November, there was a trial and I got a default judgement against me for about $2500. This is from a different law firm/junk debt buyer, Let’s just Call them Debt Buyer B. I only discovered this now because a local bankruptcy attorney sent me something in the mail offering to represent me in my new lawsuit. Apparently Debt Buyer B bought the other credit card debt I had, which is about $1300, pretended to serve me yet again and I have a court date in less than a month. I’m unemployed, I live with my mother, I’m on public assistance, I don’t have a car or property or anything except $50.00 in my bank account . I realize I’m judgement proof but I’d really, really like this gone. It’s been hanging over my head in one way or another for 5 years. I was pro se and got my first dismissal basically by just showing up to court every time and saying “Prove it.” “Prove you own it and then we’ll talk.” They never could and eventually got tired. It was nice to “win” but I don’t want to expend that kind of energy and more importantly money this time around even though I know Debt Buyer B can’t prove it either.
I can’t afford payments because I have no money coming in. But what I do have is $500.00 that my grandmother gave me as Christmas money. I know you can’t speak for these people but is it possible they might settle both debts for that amount of money? I mean, they’ve had a judgement against me for a year now that I didn’t know about and they’ve done nothing. Doesn’t that make it seem as though they don’t really expect to get this paid? Should I call and try and settle? The amount I owe seems insurmountable to me but I know logically it’s probably too small of an amount to want to file bankruptcy over.
Also, on the off chance that I did get a job, (I’ve been interviewing a lot and I’ve got my fingers crossed!) , at what point does a debt collector know you’re employed? Provided you don’t apply for any credit or do anything else where you have to put down your employer or get your paychecks direct deposited, how would they ever know? I’m just worried about garnishment should my job-related luck change.
Ok, thanks in advance for your help!
I do not think it all that realistic to settle a judgment and a current lawsuit that total 3800 dollars for 500 dollars. I would need to know the name of the debt buyer to offer anything specific.
They may never locate your employer, but judgment creditors have sometimes decades to collect, and can pull you in with asset discovery requests, and the like. So leaving these things unresolved is not a great solution if your situation changes for the better.
Thanks so much for writing back to me. I figured that $500.00 wouldn’t be enough but I was hoping. The people suing me are CAVALRY SPV I, LLC the ones who sued me last year are CAVALRY SPV presumably the same people.
I suppose I don’t really I have much of an option to do anything but leave it unresolved at this point. I know I could file my appearance as indigent but I don’t have the car to make it to the court dates or the money for gas to put in the fictional car. I’m sorry, I know you hear sad sack stories every day but I honestly feel like there’s nothing to do but let another judgement happen. If you don’t think I should call them and try and settle for 500.00 then I won’t bother. If I did call should it be to Cavalry or the local lawyer representing them?
But, can you feasibly negotiate a settlement after a judgement? I know if they started wage garnishment the chances go down to zero but what about before that?
Am I right in assuming if I did get a job and I 1) applied for a credit card or 2) applied for an apartment or 3) got an income tax refund (do they have access to that?) or basically anything where I’d have to verify I was employed they’d be on me like white on rice?
Sorry, I know, so many question! You have no idea how much I appreciate this. Thank you so, so much.
You can always try to settle for the 500 you have. You would have to be really convincing about your hardships (not that they are not convincing…), and may need to be prepared to show documentation. But 500 is just unlikely. They would just as soon get the judgment and wait and see about collecting from you later when you have a job.
Debt collectors cannot take your tax refund, nor will they know you got one, or for how much. Not for this type of debt. But keep little to no money on deposit in a bank account.
Debt collectors do monitor credit report activity, so credit pulls where you apply, put in a rental application, employment credit check,etc., they could well be able to see. But all of that information does not always lead to collection.
Debt collectors settle for less at all stages of collection, even after a judgment. You can tackle this as things improve.
Look for any low income legal aid offices in the area and see if you qualify for assistance. You may not have to just roll over.
I live on my small retirement social security income in Florida. In 2009 Capital one through a Jacksonville Law firm obtained 2 judgments on credit cards that were I was unable to pay on. I am told I can not get a bank loan with these judgments on my credit. Is this the case? If so how can I remove these judgments. They were obtained in small claims court. I barely get by now and can not afford another payment. I am trying to reduce my housing expense by buying a house and that requires a mortgage.
You will generally find you have to pay or settle the judgment debt, and get that fact updated with the court, before you can get your home loan pushed through. Removing the judgments from your credit is not necessary, but resolving them is.
Can you come up with roughly half the amount of the judgments in order to settle?
Thank you for the quick reply. I have been doing more research and hope to make a decision soon. Yes I can come up with about half (this is a new development )of what is currently due on the 2 judgments. I would offer to make a one time pay off payment. Now the question is… is it possible that I could get that 50% reduction my self? OR Can I expect to do better with a lawyer? If so how do I make the selection of a good value lawyer? I spoke with one firm that wants $1250 fee to do the 2 negotiations. But in there contract they are not giving me any assurances except that they will try to negotiate on my behalf. Is that a reasonable fee for what they are offering to do?
I understand that I do need to get a satisfaction of judgments from the holder of the judgments in order for the mortgage people to proceed.
If you can show you are a hardship situation, and are convincing, you can negotiate with the collection attorney’s office yourself and get the same results a pro would. But if you feel you are not up to it for any reason, or skeptical of your ability to negotiate the best settlement, I would encourage you not to try from the outset.
What are your current credit scores?
Do you have other collections on your credit reports?
I ask so that I can get an initial impression of how collectable you may be viewed by debt collectors.
Scores
684..Experian
671…Equifax
no score from Transunion
Key Factors are:
– serious delinquency derogatory public record or collection filed
– number of accounts with delinquency
– length of time accounts have been established
– time since derogatory public record or collection is too short
– length of time accounts have been established
There is one other account in collection for less than $500 from 11/10
Our hardship is we live on a very small social security retirement income. My income alone does not currently cover the rent. My wifes’ social security just covers food and the bills. She pays minimums on her credit cards. We can not manage another expense. She is at the max credit on 3 cards. My wife had cancer about the same time as we lost our homes to short sales..before we were married. She has those medical bills and current medical expenses we have to deal with. The judgments are in my name and they are what I am trying to deal with right now.
I think you stand as good a shot as I, or any other professional would, at getting a good deal negotiated. You are otherwise uncollectable, and that is not expected to change. I would focus on the fixed income, no assets, but are trying to do the right thing, and with the help of others, came up with a little bit of money to try to settle.
Do not mention any credit or financing goals at all.
You do not have to try to get a settlement deal put together on the first call. It is okay to end any negotiation and re-approach it days, weeks, and in some cases months later.
I appreciate your confidence in me. I will give it a go…slow and steady.
Thank you.