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.
I am trying to apply for a mortgage and have a judgement on my equifax report for $1425 (from 2010!) That has now turned into $2400 due to interest. When I called the creditor (Citibank South Dakota / Sears) they gave me a number for the attorney who is handling the case. I called the attorney and explained that we did not know what the debt was for and never remembered getting documentation or being served for this and wanted to know how to remedy it. They said that the initial judgement was done through an attorney who transfered the case to their office. They said that when they got the case they sent us a letter but it was returned to them. She said that since I was calling in they had to read me the “rights” to dispute the charge since we never got their letter. I disputed it and she made note. She said that they’d send me a letter basically showing that the court has a judgement against me and that would be the “proof”. I told her that we don’t know what it is for and we need to get it taken care of so she transfered me to the attorney. It went to voicemail and I’m supposed to get a call back.
When I called the courthouse to verify they told me that my husband was served papers in 2010 but he doesn’t remember ever getting them. The claim he signed. Honestly, it was such a difficult time for us then that it could be.
My question is, how do I get this taken care of so that we can get a home? I have a little money that I could settle, but I’m afraid of doing or saying the wrong thing and am not sure how to go about this all so that we can get it cleared up.
As a side note, this judgement was in NC and we now live in WY.
Thanks in advance for your help!
Get a copy of what they say he signed for service. Is it his signature? What is the address they list as where they served him? Did you live there at the time?
You have to look at these things because, unfortunately, many debt collection law firms and the support services they use, are some of the worst actors in the debt collection industry. And while the system has been cleaned up some in the last few years, we are talking about 6 years ago. Let me know what you find. If there are inconsistencies I can help you look at ways to remedy this.
If all you want to do is settle there is a ton of feedback to this article. Read through it all and also watch the video interview I did with a former debt collector a couple weeks ago about settling old debt when looking to buy a home.
Hi Michael,
I am hoping you can help me. In 2010 I had two judgements filed against me for medical bills I owed.
Debt 1 –
Judgement filed Nov 2010 for $6,201. With Outsource Receivables. This was filed jointly (also against my husband).
Debt 2 –
Judgement filed May 2010 for $782. With Express Recovery Services. This was filed only on me.
We are trying to purchase a home and need to settle this quickly. These judgements were incurred in Utah and we now live in Texas.
Is it possible to settle these debts for a lower cost? What do you think I should be willing to offer each one?
Have you already had your credit run for the home loan? If so, watch this video I put up last week: https://www.youtube.com/watch?v=QpdDks73QUw
If you have not tipped the debt collector off that you are trying to reach a financial goal than 50% settlements on judgments are optimistic, yet still realistic. How prepared are you to fund a settlement of 50% or higher?
hi michael
i have been sued relative to two old credit card debts from 2011 bought by collection agencies. My lawyer did not file the appearances. I have no notice yet of judgment. ( both appearance dates were within the last 3 weeks) Each amount is approximately 8k. I was out of work in 2011 when i got into this trouble and had to start completely over when i found a good job in 2012. I now make a good income, have improved my credit rating/score from below 500 to 653 and have recently bought my home. I would rather use my small existing savings and pending bonus to settle these debts, avoid litigation and avoid bankruptcy. Lawyers seem only interested in persuading me to file bankruptcy. i live in chicago illinois cook county. .
My questions:should i call the two law firms and try to settle? it will be about 3 weeks before i have the funds.
thank you in advance for some objective, sound advice.!
holly
Ideally you want to negotiate the settlements prior to judgment being entered. You can still settle, but the dynamics of the process have shifted.
Who are the two different judgment creditors and who is the collection law firm that handles the cases?
hi michael,
I’ve gone ahead and opened a consultation request. Hoping i can get to next steps more quickly via phone.
thanks
holly
Hi Holly – I do not see a consult request submission with the name Holly. If you used that name when you submitted it you may want to try again, or call 800-939-8357, option 2 rings to me. I am on the phone a ton so be sure to leave a message if you get my voice mail.
Hi Michael, not sure what i did incorrectly with the request for consultation submission but I’ve just left you a message with my call back number. In the meantime:
One of the creditors is Midland Funding and the Law firm is Blitt and Gaines. Appearance date was 4/26.
The other one is CACH, LLC and the Law Firm is Mandarich Law Group. Appearance date was 5/5.
I haven’t received anything relative to a judgement being entered as yet. Look forward to hearing from you.
holly
I am attempting to settle an old judgment with remit corp. When I offered less than the full amount owed since I am currently unemoyed, they asked me to provide proof of unemployment, tax documents, and a bank statement. I feel that I shouldn’t be providing any of this personal information, any advice?
Hi, I have lived in NY for 6 years. I had a credit card debt before I’ve left the country and I made transfers to my bf then to make the monthly payments , however he’s never paid them. So the total debt came up to 6000 USD I guess and I found out 2 years ago but didn’t really do anything about it. Last year on one of my trips to the US, I’ve opened a checking account and deposited 2000 USD. Now that I’m back home and when I’ve checked my online bank statement, there was a COAL item on it which I had no clue about. I read the blogs and saw that it was a court order. Is it the case? Can I settle my debt and pay 50% of it? Can I do it myself? I have no papers or what so ever and don’t know who to reach. Who do I need to call to settle it? I have no info about the system. Thank you for your help
It sounds like you were sued, but knew nothing about it until now. Call your bank and get the information about the underlying judgment they were served notice of in the effort to levy your bank account. When you have those details you can often go to that courts website and access public records. If that court does not have free online access you may need to work with someone local to get the information you need.
Post an update with who sued, when they say they served you the summons and complaint (and at what address), the name of the law firm handling the case, and in what court. I can offer you the feedback you need after I know those details.
Yes, you can negotiate judgment debt yourself. It can also be beneficial to allow someone else to do that. And you may share something that suggest you take a totally different path to resolve this.
Velocity Investments won a judgement for just over $1000 in 2013. Frankly I do not remember this, nor do I know what it’s for. How to I find out what it was for(what debts) and then is their any negotiating that can be done to lower the amount owed or not?
Get a copy of the original lawsuit filed in the court. while you are at it, find out the address and description of the person served (if any). Also get a copy of the final judgment.
Once you have that information post more about the original lender, when you last paid on the account, and what state you are in.
HI Michael, I read through most of the comments. Thanks, I learned a lot. Here is my deal:
I have a judgement from Pressler and Pressler representing Midland funding, for a Providian Credit card from 2000 (what I recall), though they claim its from 2008. The amount is up to $2700 with interest and court fees. I went to court looking for proof submitted when I got served, and found one paper submitted by lawyers that gave the bank name and the account number. No other evidence that the account was still open, or that it was mine in the first place. I had settled on a credit card about 10 years ago, all paperwork proving the settlement is in storage in Canada, I can’t really remember whether that was the Providian debt. Now I live in NJ and at this time I can’t attest that this debt is valid. It seems my window to ask for further proof is gone. Now I have this judgment as well as the threat of levying bank accounts, and even an arrest.
An attorney I was able to consult with for free advised me to take my name off the bank account until a settlement was reached. I have a shared bank account with my husband, I am a stay at home mother of 3, homeschool, and have no income of my own. The attorney thought he could reach a settlement at 50% of total balance. However, with his fee, that would only save me a few of hundred dollars.
I am prepared to settle, I just need to know how to go about it at this juncture of the judgement. Would you also recommend I remove my name from the bank account? We don’t own property. I have a used car in my name. And our son is currently undergoing treatments for a life threatening disease. I am frustrated that I might settle a debt I don’t owe. I have no proof and I can’t remember. REally appreciate your insight.
Call me and I will go over your options to resolve the judgment in more detail. You can reach me at 800-939-8357, option 2 rings to me.
Hi MIchael,
I used some of your strategies since last fall, and am just looking for some advice on two remaining cards:
1. Chase Marriott ($9k) – Settled for $4k and paying over three months (2 months left to pay)
2. Synchrony Bank ($6700) – Settled for $1875 and paying over six months (4 months left to pay)
3. US Bank ($15k) – In a 60 month hardship program for $253/month.
Problems:
4. Chase Sapphire ($27k) – Going unpaid currently. Offered me a hardship program for $460/month. 180th day past due is July 1.
5. Bank of America ($32k) – Offered me 25% settlement ($8k) or 60 month hardship at $560/month. Currently 175 days past due.
I currently am able to get into the Chase hardship program at $480 a month, but that means I cannot pay the BoA at all. By the end of this year I should have about $8k that I can use towards a settlement with BoA. My biggest fear is that between now and then BoA will ultimately sue since I doubt a collection agency will keep my account open for >6 months. What do you think I should do?
If it were me in your shoes I would settle with BofA and let the Chase account go to an agency and settle that one later, after having saved up for the lump sum,and not the long term hardship plan.
I had a judgement filed against me in the amount of $1516.22. I called the debt attorney last year to see about a possible settlement but they would not budge at $1516.22. Called recently to see about a possible settlement but was told the amount is now $1947.10 and they would not take anything less because the garnishment process has begun. What should my next step be?
Who is the judgment creditor? Who is the collection law firm handling the case? What state are you in?
Its a department store card/GE money that went to Portfolio Recoverty. The Law firm is Couch, Conville, & Blitt in Louisiana.
Louisiana allows for up to 25% of wages to be garnished. If you meet full or partial exemptions you can often negotiate a lower settlement. If you do not, they are often not inclined to settle for less because an active garnishment means they will get all their money (unless you leave that job).
Is your check being garnished right now?
Have you looked into any exemptions you may qualify for?
No garnishing…I do not get paid by a traditional w2 and its been a tough year….Not sure what exemptions I qualify for,can you explain
If they have a garnishment order in motion, the collection attorney will often wait to see the outcome of that before engaging in discussions about settling for less. Given the players involved and the size of the judgment being relatively small, if the garnishment is not successful, the settlement may not be optimized for savings (but you should be able to get them down some).
Exemptions to garnishment are state specific, and you contest the garnishment formally through the court once you receive notice. That may not happen at all if you are not a w-2 wage earner. Post an update on how this progresses and let’s go from there.
How long does it normally take for an unsuccessful garnishment process? I would like to make another attempt to settle.
I have seen this kind of thing take a couple of weeks, and also seen it take months.
Well we found out that they tried to garnish back in October last year and they received the letter back in November showing that I no longer had a job. They told me it was in garnishment status, so i decided to call the courts in my area to see how long the process can take and none of the courts had any record of a current garnishment. Called them back to ask them what court they filed the garnishment with and to tell them I called each one and none had any records-then they agree to settle. Apparently they wanted to prevent a settlement agreement and thought they’d scare me into paying the full amount. Long story short…theyve agreed to settle. What advise do you have prior to me paying?
My 75 yr old father was served a warrant in debt (civil claim for money) last week, for $5400. owed to Walmart/Synchrony originally and now sold to Midland Credit Management. My parents are poor money managers and terrible judges of character and age and early dementia has only worsened it. I took over their finances last summer when I discovered they were not able to pay their rent. I/they have paid off over 4 credit cards but some things were already charged off when I took over and frankly they cannot afford the payments. Both my parents are retired from the federal government and my mother draws SSI and my father draws VA disability. I do not believe they are candidates for bankruptcy because I believe they have filed it before. They currently live in Virginia, do you think it would wise to fight it? This company, to my knowledge, did not offer a partial payment one time and your done forever deal, Could you recommend and experienced debt attorney in Yorktown VA? The attorneys for the plaintiff are Reiss F. Wilks, Nancy Loftus, and Peter Heindel out of Richmond VA.
Do your folks have any assets? The situation sounds like one where Midland Funding may stop all collection activity if you are able to communicate a hardship that meets their guidelines. Read Article 2 on that page and tell me what you think.
You can call the attorney for Midland Funding and help your parents consideration for hardship. Do you have a POA for your folks?
If they are not suited for the hardship scenario let me know and we can go from there.
They have home in GA that they are upside down in and a friend (dirt bag) is currently living in and paying the mortgage as far as they know, a van that is handicap accessible (for my mother) that I purchased for them in 2007 and put in my dads name probably worth about $5000. and a truck that is worth about $1200. I do have a POA but I have not added my name to their bank accounts because I fear liability. I absolutely think they qualify for the hardship scenario, I called MIDLAND corporate today and they did not give me the hardship option after I explained the scenario including nothing garnish-able the upside down house but they offered me a one time $3700 payment which I thought was reasonable but not possible for them.. I will call the MIDLAND attorney tomorrow. Any other recommendations?
Not yet. Call the attorney and let me know what happens with that.
Glasser and Glasser is representing a third party company that bought the debt
I sent you an email with a list of attorneys you can call and consult with about whether or not vacating a judgment this old for lack of service is a realistic option.
You could also look at filing debt collection complaints against both Capital One and Glasser and Glasser with the CFPB.
Question?? If I move to NC, can a garnishment issued from Chesapeake General District court still be able to make my company garnish my check? This creditor had an original judgement in Richmond, VA; went to court in Chesapeake City, to get my company based in Falls Church, VA garnish me…
Wages in North Carolina are protected from garnishment.
Can I now get a judgement garnishment issued in Chesapeake, VA vacated since I moved to NC. My company is still in Falls Church, VA but my new residence will be in Raleigh, NC
The garnishment would be impacted by your state of residency, but the judgment would not. There are still methods for creditors to collect on judgments even if they cannot garnish wages.
So, if my new residency is NC, who do I contact to stop the garnishment or give my new home address to show I live in NC?
My employer is who I would contact, but not until I establish residency.
Talked to Glasser and Glasser Attorneys and they received the notice from Consumer Financial Protection Bureau for response. Per Matt Groves, Attorney at Glasser, he said they will move to vacate the judgement and send something to stop the garnishment. He also asked me to send him something with my address from 2008.to speed up stopping the garnishment… Is that normal and should I? I’m sending the motion to set aside the judgement and vacate the judgement in Richmond certified tomorrow because I was never properly served. Should I send him something or wait for the courts???
I would provide Groves and the Glasser law firm what they need to expedite things if it were me. I would not file with the courts if it is not necessary. You will likely get further faster by working with the law firm to unwind this.
Keep me posted.
Well, Glasser and Glasser faxed the request and the Garnishment is stopped 😉 Mr Groves is also going to court in Richmond today to request the judgement be vacated,…Wow… Your information helped has helped me to resolved this very quickly…. I do Thank You
Thanks for the updates Allen. It is good to hear how quickly Glasser and Glasser moved to correct the situation.
I have a judgement from CapitalOne Bank entered 2008 and just received a garnishment letter to my company from Glasser and Glasser in Norfolk saying I owe over $3000 from a hearing 3/2016 . First, the address they show I was served is incorrect and I was never served; and second, this debt is over 7 years old. Do I have a chance of stopping this garnishment?
Challenging a judgment this old can be difficult, but worth trying if you can show you never lived at the address they sent all these notices to. What city and state are you in?
I live in Chesapeake, VA and the Debt Collector is Glasser and Glasser
okee dokee i will thanks
hi michael,
Is the option to call you still available?
Yes, you can reach me at 800-939-8357, option 2, or email me usingthe address you get these comment notifications from. Email works great to schedule a time to talk that works for both of us.
one judgement was for about 9k and the other about 17k…now the attorney for the bigger one has taken over the smaller one too.
Give me a call on Monday to go over some of the strategies that you may be able to use. You can reach me at 800-939-8357, option 2 rings to me.
i successfully negotiated a HELOC with Wells Fargo and ignored the other two credit card debts, a Wells card (about 15k) and a Discover card ( about 6.5k). both of those debts were within 2-3 months of the 6 year SOL when both received judgements. Now one of the Attorneys has taken over both debts. I have enough equity to satisfy both so I’m leery of foreclosure.
Of course both debts now have grown larger because of fees and interest.
the interesting part is that my mortgage is with the USDA rural housoing service, who consider my house as government property until the house is paid off. So i may have some leverage to settle.
Settling judgment debt is mostly about providing an opportunity to get paid that may not otherwise exist. And if someone is viewed as a high collection target (should be able to get paid all of what is owed), looking at the real time value of money (a lump sum can be viewed as a better outcome than being paid over a long period).
How much are each of the judgments?
I have not actually been served yet but I have received numerous mailings from attorneys saying that I am being sued by Calvary SPV I, LLC. Original creditor was Citibank. The amount is over $16,000. I am not employed. I stay at home with my 3 young children. I lost my job over 5 years ago and was no longer able to pay this credit card. My husband is the only one working. In the mailings they have stated that they state that a lawsuit/ or wage garnishment has been filed against me. I am in Georgia. We are barely making ends meet as it is so I don’t think I can afford an attorney and I definitely can not afford to pay the amount due. Any advice?
Do you have other unsecured debts besides the one Cavalry is suing for?
Hi Michael,
I just received a Original Notice and Petition for a Money Judgement. I live in Iowa and this was just delivered by a gentleman to my front door. It asks for me to electronically file an Appearance and Answer within 20 days. My question is, is this the actual judgement or notice that one will be made depending on my answer – choices are: The claim is denied, The claim is admitted, The claim is admitted in part in the amount of $______ – and I have to check only one.. My question is, can I settle this and pay in full the requested amount at this point to the Plaintiff or is past that point and I have to settle within the courts? We have been enrolled with a Debt Settlement Company for 2 years and recently found out last month they were keeping almost 40% of what we were paying them as “fees”. We just enrolled with a DMP with a local company, but I am guessing this particular creditor we received court documents for are too far to be enrolled in the DMP and it is something we would like to take care of without a Judgement filed if possible. Any advice/answers would be greatly appreciated.
You have just been served notice and that is the beginning of the lawsuit for you.
You can typically call the attorney for plaintiff and negotiate a pay off at this early stage. Be sure you are negotiating that the case is dropped so that no judgment is entered in the record.
Who is the debt settlement company you were using?
Who is the DMP provider you just signed up with? Most DMP’s do not take litigation files.
We just signed up with our DMP last week. We didn’t have litigation files at that time. I am sure they will not work with this case as we were unaware it had gone this far. The Debt Settlement Company had us change mailings when we enrolled to an address they gave us. So we were not receiving any information that Synchrony had turned this over to an attorney until we were served papers last night. So our DMP thought they would be working with Synchrony or Portfolio Recovery Associates, LLC, not an their attorney who this account was turned over to. The Debt Settlement company we had enrolled with originally was Superior Debt Services.
Okay, thanks. If you are going to be paying in full it should not be too problematic to get PRA’s collection law firm to drop the case, just be clear that is what is happening, and get it in writing.
Are all of the accounts you are enrolling in the DMP charge off, or part of the debt settlement program with Superior Debt?
We cancelled our Enrollment with Superior Debt. At this point none of them are part of it anymore. So now the accounts enrolled in the Debt Management Plan with CCCS are varied. Some are the original credit card company, some are charge offs that were cancelled by the creditor (but CCCS still enrolled them to be paid) and 3 more accounts that are written as a charge off but purchased by another lender (one is the one mentioned above – Synchrony/Walmart/PRA) (another of which was purchased by PRA was owned by GEMB/Floor Trader). Thanks for all your advice and help, I really appreciate this, we made bad choices and lost a lot of money with our farming business and trying to get back on our feet.
Thanks for the additional detail. I typically look to negotiate a lower lump sum pay off on charged off accounts when ever possible. The benefits to using a DMP for the collection and purchased accounts are slim to none. If you do have an express agreement for the payments, you do keep them from suing (if they have not already), but that is about it.
Is there any way you can raise some more cash to settle more than just the one PRA account in court? If so, how much?
Are any of the accounts you set up in the DMP not yet considered 180 days late?
Which DMP provider are you working with? Is it a small local agency?
I have a judgement for cc debt of $3000 from 2010. I am looking to buy a house in about 6 months, and want to get it taken care of but wanted to entertain the possibility of settling. I sent an offer letter to the attorney on the judgement about 6 weeks ago and have heard nothing back. Should I deal directly with the creditor instead? Would a letter or phone call work better? It is March now and I will have about 60% of the $3000 by mid April, should I wait until I have the money to try and approach?
Thanks.
I am not a fan of letters making offers to settle. I prefer negotiating the settlement on the phone, and then get the agreement in writing before paying.
Be prepared for that 3k amount to be higher with interest the court set.
Who is the judgment creditor? With the account being as old as it is, you may want to start by calling the plaintiff and find out if you can deal with them directly, or who they have the account placed with if not the same attorney that sued you.
The creditor is Best Buy (Houston Funding) in TX. One thing I forgot to mention was this was issued in FL and I have been in VA the last 5 years. Would this have any effect – I’m trying to take care of without them garnishing etc but will not have the full amount for a couple of months.
Thanks for your advice.
I would wait to start communicating until you have 2k to work with (assuming the debt has grown from 3k to 4k).
It would be best to have this settled 2 to 3 months prior to applying for the home loan.
Thanks Michael I will let you know what happens.
Hello Michael, Just an update. I tried to contact the OC but the phone numbers were invalid. Searches on the net also mentioned the place went out of business. If you recall I had sent a letter of settlement to the attorney on the judgement, but had never heard back. I called the attorney’s office and a representative said that the case had been “closed” – not sure if that means internally in their office or what, but also that he would contact someone for me and acknowledged that he did receive my settlement offer letter and that it was in their “system”.
That same day (2nd) call he said he spoke with “someone” – presumably at the OC, and they (OC) would review the settlement offer and said I would hear back from him in “a day or two”. After four days I called and left a VM, inquiring on what had happened, on the fifth day I called and spoke to another person, who couldn’t help be but said they would leave a message for the first rep to call me back.
Day 7 is now here and I called this morning and spoke with the original rep, he couldn’t remember my name, but after looking it up he said he had not heard back from the OC, but would call them again today to see what is going on and call me right back whether he could get a hold of them or not. It’s been 4 hours and I’ve heard nothing. I fear this may be going nowhere.
Any advice for how I could expedite this?
Thanks!
Tim
Who is the collection law firm you are contacting?
Sorry for the delay. Actually I had several calls (negotiating) after my post yesterday. They won this one. You were correct in being prepared for the amount to settle to be more.
The total amount had ballooned from $3034 to $4700 with interest and fees, but I was able to settle for $3300 – lump sum. Just about 70% of the inflated amount. The original amount was $3034, so in reality, they got their original amount, plus the attorney filing costs which were $300. They will be emailing me the document for the settlement hopefully today. I would suggest to your readers to follow your advice – don’t try to settle via letter, I waited over a month to hear back from the attorney’s office (and they HAD received the letter and it was in their system), but it took a call to get everything rolling – and even that took over a week to get everything resolved.
Thanks again for your help!
Hello,
My husband and live in New York City and he has a judgment on him for the past 11 years and they are now trying to garnish his wages. He had received letters from the collection agency thru the years but he did not take them seriously since he never received anything from court and was
never served to go to court. Of course they claim they did serve someone at our address back in 2005. Now 11 years later a legal document stating they are going to garnish his wages.
My husband is planning on retiring by the end of next year due to health issues. We live in an apartment the is provided by the job so when he retires we need to leave. We purchase a fixer upper in MD 3 years ago to fix up and live in when he retires. The house is deeded in its entirety in both ours names. The home as it stands is worth approximately 34000. according to the last tax assessment. What we would like to know is can they go after the house and in what way?
Would they sell his part of the equity or would they put a lien on it and what will it all mean?
Could they force us to sell the house? Sell it themselves?
His has not retired yet because the house is uninhabitable, but the the plan was as soon as it is,
he would retire and we would move there. Please respond as we are truly worried that we will end up penniless and homeless.
Thank you
You have options to consider. First, who is the named plaintiff in the lawsuit? Who is the collection firm that handled the case originally, and who is it that is trying to collect now?
I have a cc judgement against me from 2008. They have not garnished wages at all and I haven’t had a bank account. I just got a letter to settle the debt for 50% $5,800. Is this my best option? I don’t want to push my luck and talk to them. I feel like if I try to negotiate lower than what they are offering the may look into me more and start to garnish my wages. I’m in Florida if that makes any difference. Thank you for your time.
Getting judgments settled for under 50% is not all that common. Calling to try to negotiate a better outcome is likely not going to be productive anyway.
Who is the judgment debt owed to? That could change my feedback. I could be more encouraging if you are on a fixed income and not going to likely work again, no assets, etc.