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.
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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 have a judgement against me with an attorney and have been sending the attorney a payment for 4 years now and would like to know does he have to by law report payments toward the judgement to the credit reporting agencies.
Dudley – It is generally not the attorney that reports. It is the court records that are being scanned by data brokers who the credit reporters, like Equifax, get their info from.
Neither the attorney that sued and is receiving payments, nor the judgement creditor that is ultimately who that money goes to, is responsible for updating the court record each month a payment is received – at least to my knowledge. That would be nice, but is probably cost and resource prohibitive.
Hi.
I just found out that I am being sued for 7,862.00 and called the credit card company and they referred me to an agency that bought the debt and I called them and they said I can call the law firm. They were not even willing to negotiate just referred me to the law office. My question after the attorney has filed the suit against me….will it be worth my while to try and negotiate a payment plan or to pay off the debt with the law office? Also can they go in and take my Roth IRA account? I have heard a lot of horror stories about garnishments…
I think it is worth a shot to try and settle with the lawyer…before going to court. What do you think?
Thank you!!!
Lisa – It is pretty common to have a lender or debt owner refuse to speak about the debt once they have it placed with an attorney for collection. Depending on the circumstances, it is very worthwhile to call and set up a payment arrangement, or to negotiate a pay off amount. I encourage settling for less than the balance owed in a single lump sum payment whenever that is possible. You can often resolve this at any stage of the collection process in the courts.
The collector would need a judgment in order to garnish, lien, or levy anything. Your IRA is typically not going to be something that can be touched.
Now that you have been sued, it is a good idea to consult with an experienced consumer law attorney with a practice that focuses on collection defense. Many of this type attorney offer an initial consult at no cost, so connecting with one makes sense. If you need help locating one, post the name of a larger city near you and I will email what I find.
I got a call tonight fro daughter in ga saying a cop was there to serve me papers from an old credit card. Merrick from 2007, which after i received it became ill and had surgery and did not work, and still not working. I called the cop and he said it was from an attorney in at. that account was charged off, but they are telling me I owe 1,424 .. I dont know what to do, someone told me if it was charged off and that old that its the company that bought old accounts from Merrick, and they are just trying to get their money back.. I cant work , and sure cant pay that amount
cynthia – You mentioned the Merrick bank collection account is from 2007. Can you document when the last payment was made to the debt? If you can, what is that date? Is Merrick still showing it on your credit report?
I have a judgement against me from Javitch, Block, and Rathbone LLC from 05/2007, the original amount was $3380… I had no idea I was even sued or had a default judgement against me until last month when I applied for a mortgage… I haven’t heard anything from this attorney’s office in nearly a decade, but once I was made aware of this settlement I wanted to get it taken care of so I can purchase a home. An attorney I talked to called them to talk settlement for me and they said they could do it for $1900, which I was fine with. My problem is now that I set aside the money to pay them I can’t get in touch with anyone to pay it and they’re asking for information that they didn’t ask the lawyer for when he called for me… As we never got anything from them in writing from them I have no confidence that if I give them the info that they’re asking for (address, SS#, phone#) that they won’t just try to hit me for the full amount all over again (totaling $4700 w/ costs added)… I would like to get this matter settled ASAP, so I was wondering if you had any advice on how to go about taking care of it at the initially discussed $1900 and what info I should stay away from giving them as I am not “judgement proof” anymore.. oh and I live in Ohio if that makes any difference… Thanks in advance for any information
i meant “made aware of this judgement” in the third sentence, not settlement
Mike – The questions you are being asked are general enough, and pretty common. Its the questions about your current income, assets, and expenses, that can harm your efforts.
You may want to consider having the attorney continue the negotiations. Is there a reason you did not?
What does your credit report look like? Are there other accounts being used and with current payments? If so, what types of accounts are they?
I didn’t actually retain the attorney, he is kind of just helping me a little because he’s close with the family that I work for, so I guess in a sense I’m still working with him. He’s trying to get in contact via mail with them to get everything in writing right now but it’s been almost 2 weeks with no response (I can’t really complain since he’s doing it for free) and time-wise my back is against the wall because I have another 2 1/2 months left on my lease so I need to get going on things to purchase a home
As far as my credit report, it looks pretty decent (scores range from 673-690). That judgement against me is the only bad thing on it, and the only other things are credit cards I’ve long paid off and my student loan which is almost paid off with all payments on time.
I just really wanted to see what I could do to hurry it along without getting myself into more trouble with these people. I just don’t want to end up with my bank accounts frozen, or assets seized because I’m being impatient. But, as I said, my impatience on the matter is due to the small window I have to get out of the place I’m in instead of ending up having to wait another full year to move.
Thanks for responding, and thanks again for any advice on the matter
Mike – 9 times out of ten, at least in my experience, you negotiate over the phone first and get a verbal agreement, then follow that up with documentation outlining the deal. This applies to virtually all types of accounts, and all stages of the collection cycle.
I understand wanting to push this along with the goals you have. Perhaps you would benefit from working with a specialist who can help you through this. If you would like to talk to someone about that call 800-939-8357
I have an outstanding credit card debt that’s been charged off ($2900.00). It has not reached judgment, though I was served last week that it’s now been filed. I called the attorney immediately and made a $100 payment with them. I was advised to call back on FEB 20th. The following day, after the phone call, and being served, I received a letter from the attorney stating that I could use my tax return to settle at a discounted rate and they told me to mail / call back with an offer. The request to settle was dated AFTER the court papers were filed. Does that sound strange to you?
Kyle – No, it does not sound strange. You looked less collectable to them before you made the 100 dollar payment, so a computer algorithm probably determined sending the settlement offer letter was a good idea. You can still call and look to settle this in a lump sum rather than monthly payments on the balance. You may still even save as much as you would have otherwise. If you go that route, post an update with how that all shakes out.
Ok, I checked the paperwork. The plaintiff was Citibank South Dakota. I live in Texas.
Amanda – I think you have a shot at settling the Citibank judgment for half of the balance owed, but not a great one. The medical bills on your credit report right now could prove helpful. If I were in you shoes, I would negotiate and start with something like – “I am trying to get a grip on all of my financial challenges in 2014. I have very limited resources, most of which I am lucky to have family willing to help with. This debt is the largest of all I have out there unpaid, but my medical collection debts are smaller and more affordable to pay. Before I figure out which debts I can tackle, or even if I can afford to, I want to know if you will settle with me? I only have 3000. If you are open to accepting that as a full pay off, I may be able to get that” – or something like that.
Judgment debts are not as negotiable as debts not in a legal status. I think it would be more realistic to prepare for a 70% settlement, but have seen 50%-ers enough to encourage you shoot for it. Owning a home and having open credit accounts make you appear more collectible, the medical debts offset that some, but only some. Judgment creditors have time on their side, your goal may mean you don’t. Which brings up an important point: Be patient if you can. If you do not get a deal to settle on your first try, call back the following week or month.
A satisfaction of judgment is what will occur in the court record once your case is paid, or resolved via the settlement you are targeting. They should be the ones to update the court that the judgment was settled, but you can too, with proof of the agreement and payment.
I don’t have the paperwork with me, so I’m not positive on who the plaintiff was. I believe Citibank is who shows on my credit report. I just kind of found your thread here while trying to research the whole judgment issue, or I would be more prepared to answer questions. Thank you so much, by the way, for your website. It really gives people like me a fighting chance to understand where we stand. I have two other credit cards that are current. They both have zero balances. I literally only put $50 or so on them to keep them going, and then turn around and pay it at the end of the month. I have 5 or 6 less than $500 outstanding medical debts on my credit report as well. How exactly does the judgment become satisfied?
I have a $6000 judgment against me from a credit card. I didn’t understand what it all was, so I didn’t go to court; now I realize how incredibly stupid that was. I think the judgment was made in 2009. The original limit on the credit card was $2000! How likely is it that the credit card company will settle with me? I am willing to lay down about 50% of the total in cold hard cash if they will. To us, $6000 might as well be $20,000. Literally the most we can offer is to use our income tax return to pay whatever we can of the judgment We are working on getting our finances in order to sell our current house and buy another one. If they settle, how will it all effect my credit?
Amanda – Who is the plaintiff that sued and got the judgment? Does your credit report show that you have other accounts that are current (other than house and car payments)?
Whether or not you have a good shot at settling for half will depend on a few things. How collectable you look is one of them.
In today’s home lending market you could find you have to get the judgment settled, and showing as satisfied, in order to get approved for a new loan. So settling the judgment improves your credit, but maybe not your credit score immediately (though that is possible). Do you have other collections on your credit?
I had a “friend” who had her own business that went bankrupt. She wanted to open again but needed a merchant account. I had no idea what that was, but she knew I had good credit. She explained to me that it enabled her to use credit cards of her customers. I honestly can’t remember whether the merchant account was in my name or hers, but it was her business. Long story short. She used the customer credit cards before they received their product or they weren’t satisfied and she spent the money in excess of $50,000 that was charged back to this account. She forged my signature and company records indicating I owned this company. This was all explained by me to an investigator that came to my home from the card company and their lawyers. It was out and out fraud for which I was ready to sue her. I also, unbeknownst to me, when she called my house from her cell phone and got my answering recording she left a message and didn’t hang up and the rest of her conversation was recorded since her cell is on and I hear her talking to her husband about the forged signature and he says”if you don’t get her on your side, you are done” and he says my name. Once again, long story short, I haven’t heard anything once I explained what had gone on, until today. A law firm collection agency talks about a post judgement arrangement. There was no judgement as far as I know. I was served. I responded to the court and their attorney. I had no attorney nor funds to get one.
Did I get the call today because the debt was probably sold to another collection agancy? This is extremely stressful to get these calls. I can’t go through all of what I did before to prove myself. Can I just ignore the call?
Carol – What was the date you were served, and what day did you file your response? Did you properly notify the plaintiff of your answer? Did you do any discovery after answering the complaint?
It is possible that the debt was sold. Who is the the debt collector contacting you? Who was it that sued you?
I would not recommend ignoring anything to do with the debt. Staying on top of this should be a priority.
Judgment date is 2011, yes, many other creditors. I saw an atty in 2005 (before the laws changed I was going to file for bankruptcy, but didn’t have the $$ to do so). The atty told me to stop using the CCs and stop paying them and that is what I did. Dealt with an illness that prohibited me from working for a long time, but now am back full time. They have not gotten any $$ since 2011-that is when I saw the Levy/Judgment-could have happened before then, but how would I know that? All I have is something sent to me from my employer that was filed through our local Sheriff’s Dept. Original creditor was MBNA, now it is a collection agency called Allied Interstate. Principal is $18,600 and last Aug. it said debt was 35K+. At that time they were willing to accept $8800. I want to call and offer $5K…I can go higher, but don’t want to, of course. There is one other Judgment that I know of from Chase–no idea amount, it is filed in a county where I used to live. Guess I will have to contact their Sheriff’s Dept. to find out. The $18/35 is my largest so I will start there. I do have a plan…to try to get everybody to settle and get out from under the debt and start regrouping my credit. I used to make alot of $$ that is why I was afforded so much credit. Realistically I will be at my former level of salary in the not so distant future so I have no need to file bankruptcy. I will be able to pay, but right now there is a lump sum that I cannot invest and I need to do something so that I can at least bank it somehow!
Leigh – 5k settlement on a 35k judgment, even if it has been 3 years since they saw a dime, is just not all that likely. When that type of savings can be negotiated, it is usually due to some documented hardships, or fixed income scenarios.
There could be alerts set up through different technology by some of these debt collectors. Changes to credit reporting and public records (settling and judgment being updated as satisfied in the court record) can bring things to a simmer on old debts pretty quickly.
I would encourage you to call in and talk with a specialist about how to coordinate your settlements as much as possible with the cash you have on hand: 800-939-8357
I could use some help here.. Back in 2008 – 2009 I fell on some hard times and have been slowly but surely digging myself back out. I have paid off 5 different creditors in full without settling to the tune of 24K since then. I have 2 left. One is in “pre-legal” status according to the notices I get in the mail and JC Christensen & associates are the current attorneys/collectors, original debtor was HSBC. Statements currently show 13K due last payment 9/16/2009. The other is for 20K with Portfolio Recovery Services, originally MBNA/BOFA and Weber and Olcese is the collection attorney.
I was recently served with court papers and had 28 days to respond to the Portfolio Recovery Services debt. I decided to try to settle with them since I got a little bonus this year and was expecting my tax refund. I offered 5K, was countered for 12K, and so I inquired about payment arrangements instead. We all agreed 600 a month would work, which is feasible for me since I JUST paid off another old debt. Its not comfortable, but then I haven’t been comfortable in years, haha. Nothing new. Weber and Olcese was very nice, told me at any time if I came upon some cash I am more than welcome to try to re-negotiate a settlement. A few days later I receive a form from the State of Michigan that says “Notice to attorneys and/or plaintiff: Default judgment request is required to be filed with the court” because I failed to answer the complaint. My question is…what does this mean exactly? Wage garnishment would be a very bad career move for me in the position that I hold and I am very concerned. If I continue to make payments as arranged, am I ok?
You see, I would like to take the cash I have and pay off my other debt. That would leave me with this last one I am making payments on. I actually have 9K to work with but would rather spend 5 to get rid of the other guys and leave myself a cushion for emergencies OR if anything unexpected comes up I don’t want to miss an agreed upon payment. Plus I think at the end of the year I will be able to settle the remaining balance with Portfolio and be done once and for all. I’m afraid to pull the trigger on my master plan because…I believe if they garnish my wages, they will get more than 600 per month (Michigan) if they can get 25% of my net pay, and garnishment would be a very bad career move for me. I also don’t want them getting into my bank account for the reasons mentioned above, taking all my cash and then garnishing my wages. Then I end up with another judgment from HSBC because I see that is where that one is headed as well.
So basically my question is…What does “Notice to attorneys and/or plaintiff: default judgment request is required to be filed with the court” mean? Am I on my way to garnishment already even though I just made a payment arrangement with them? Or am I safe to assume that as long as I stick to my agreement I might survive this?
Brooke – From what you shared, and the collectors involved, I am of the opinion you will be fine if your payments continue and are made on time. Miss one by a day though, and your file could see extraordinary collection efforts that can result from their being a judgment in the courts.
I get your thinking about having the money in reserve. I would have looked at those accounts opposite of the way you have, preferring instead to settle the lawsuit with Portfolio Recovery for the 12k (or countered with say 10k), then set up a payment system on HSBC account with JC Christensen, who can be reasonable too.
Does that deplete your set aside funds for these debts? Yes, but you can more aggressively save up with the PRA debt out of the way, and be rid of the full 20k overhang you will be stuck with moving forward, and eliminate your concerns about the extra collection tactics afforded a judgment creditor.
Have you already paid PRA, or signed off on any agreement?
I know I’m more of the asking for help type on here, but this one struck a bit of a personal chord with the judgement/worry about garnishment bit and being in Michigan!
I had firm obtain their judgement years ago, but in a panic, before any garnishment was done I agreed to a payment which was reasonable enough to work with. I paid on time and faithfully for a year. Trouble was that at the time we agreed to this they suggested (mind you nothing was in writing!) that we revist the payment schedule later.
in other words they wanted get more but were willing to accept what I offered at that time. My hope was for a tax return, but that never materialized, so I kept on paying. Sometime in early summer the law office called a few times and left very non-descript “call us back” type messages. Probably coudln’t leave much detail, but they also never really did call back. The proceeded to set me up for wage garnishment!! A few months after those calls I come in to find that they’d done that. I immediately contacted the courts and learned that, well, at least here in Michigan, you can submit a payment shcedule with the court, even if they have a judgement. If the court agrees to that schedule/amount, they are locked into it. I’m sure there is that possiblity that you miss one or are late and they can try to push for garnisment, but I felt ambushed.
I asked them why they did that when I was still sending them pyaments (2 months worth after they attempted to contact me half heartedly) and they fell back on some lame excuse of how we had agreed to negociate this again in June and when I didn’t I basically “faulted” on the agreement in their eyes. I aksed them if they normally cash checks from people who have faulted on agreements and they told me those were “good faith” payments.
The good part? When I went to obtain the payment schedule from the court they reversed what they THOUGHT they were going to get out of my check… rihgt back to me so I can pay my rent and other bills (idiotS!) .. the bad part? The embarassment of having to go through that when you thought you were doing the right thing.
So my advice? Contact the court where the judgement was filed, ask about setting up a payment plan. I’ve found the clerks there to be very helpful, at least at our court, and much better to deal with than the law firm I was stuck talking to.
Thank you SO much for the responses, this has been so helpful to me.
To answer the question if I have signed an agreement, or where exactly things stand with PRA:. I verbally agreed over the phone to pay 600.00 on Monday, they have not withdrawn the funds yet (I don’t know why) today is Wednesday for those reading. I verbally agreed to have the 600.00 payments begin to be withdrawn in March, and I was told that he would mail to me our agreement. He didn’t say anything about me signing and/or sending anything back to him. I haven’t received that yet, but it is still early.
Based on your advice, and the experience that Bill was SOOO kind enough to share (Thank you!), I feel that settling with Portfolio would be the best course of action. JC Christensen will probably allow a lesser monthly payment amount and I can begin to rebuild my savings for emergencies and to try to negotiate a pay off at a later date. Its a little scary have been a cash basis broad for so long to wipe out my bank accounts in one swoop, but at least this way I have some control over what happens going forward.
Based on my response, do you think that Portfolio will still settle? Keep in mind that the judgment may have been crossing in the mail during prior negotiations. I would like to counter with 9K and buy myself a little time, in case I really need 10. If 10K is what it will take to get it done I may be able to swing it somehow. I discovered this website after some of my dealings, and I will be sure THIS time to get whatever agreement in writing before giving them any money!
If I can’t settle it out anymore I will most certainly take Bill’s advice and make sure that a payment plan is set up with the court itself. I am so glad I found this website and thank you both Michael and Bill for your help!
Brooke – I do think you will be able to settle for a lump sum still with PRA. You may be able to get them to 9k, but I would have been more optimistic for that figure if you had not already had a payment plan discussion with them. If you can get the deal done in that range, I hope you can take advantage of it.
I have a large outstanding judgment that I am ready to settle. I am afraid to call them because once I do they will know that I have $ from somewhere and I am worried that they will start garnishing current wages. They did garnish before, but I think they only got 3 payments of about $5 because I only had part-time work. What do I need to ask for from them besides something that says it is paid in full? Could you explain 1099? How low can I start? Do I base my offer on Prinicpal or amount I owe now which is more than twice principal? Attorneys that return calls all want to talk me into a bankruptcy and I am not willing to do that. Do I need an atty in order to settle all this stuff? Thank you in advance!
Leigh – It is better to approach negotiating debts with a plan, and realistic targets you can settle for. How much is the total owed today? How long has the judgment existed? When was it they last garnished or levied an account and got any money? Who is the judgment creditor (name of plaintiff that sued)? Does your credit report show you are current on any other loans, or does it show you have other collections?
You are going to want to get any agreement you make to pay documented. Here is an article dedicated to the topic of getting your settlements in writing.
Here is more about taxes on forgiven debt, and how to figure out if you will owe tax, or are what is often referred to as technically insolvent.
You do not need an attorney to negotiate and settle this debt for you. It can be a good idea in some instances though.
I had written before and you offered an 800# to talk to someone. I left messages and never received a call back. It’s been a few weeks and I still have no ‘professional’ who has been willing to speak with me about trying to settle two judgments–1-MBNA via Allied Interstate–Principal $18,600 + Int = $35K+; 2-Chase Bank via attorney–Principal $4600 + Int=$8200. I also was unable to get a credit report online so I sent all my identification three weeks ago and still have never in my life seen my credit report. They said it would take no more than two weeks for me to receive it via mail. Do you have any other suggestions where I could get a copy? I asked my Credit Union and the only way they will give me one is if I apply for a loan. Only one attorney out of 8 that I called returned a call and they want $125 for an hour consult, but their specialty is bankruptcy and they really want to talk me into that. I will not file bankruptcy. There is no reason to. I just want to settle these judgments but from every thing I have read I really need to see my credit report before I talk to them. Is there a website or reference document where the high points are listed in a concise manner? The internet is overywhelming with conflicting information. Thank you.
Leigh – The judgment information you will find on your credit report is not going to be all that instructive toward the goal of settling those debts. The court record where the judgments were entered is where the bulk of usable information will be.
I am not sure what happened with the message you left prior. I am going to send an email reply to this comment notification copying you, and one of the specialists that pick up calls. You two can coordinate a time to talk all this over.
As far as a concise manner of obtaining; then dissecting; followed by actionable information to improve credit; I like http://www.credit.com and the credit report card product, combined with their many articles. They have paid credit monitoring products available similar to other sites, but try the free version for a start.
I recevied a letter notifying me about a suit over $965 of credit card debt. I called the attorney and set up a payment play to pay the debt off in 6 payments. They said they will send me a judgement agreement to sign and send back. Since I have a payment plan set up with this collector, will I still have to appear in court? What exactly is a judgement agreement, they did not do a very good job of explaining it to me.
Thanks.
Tom – It sounds like you are agreeing to a confession of judgment entry in the court record (and thereby your credit report at some point), in order to have the convenience of the monthly payments that you can afford. These are good reasons to try to come up with the money you need to settle the lawsuit, and get the lawsuit dropped. Do you have any other method to pool together the money to settle this?
If you get the agreement reviewed and signed you are agreeing to a judgment, so going to court may not even be a formality, because the document will be filed in the court record shortly after you send it back.
It is a good idea to run any legal questions and concerns by an experienced debt collection defense attorney. If you need help locating one, send me an email (same address these comment notifications come from), with the name of a nearby large city. I will send you back contact info for any I find close by with experience in this area of consumer law.
I was served with papers about a credit card bill of 3100.00 and went to court. The lawyer spoke with me in the hall and we made an arrangement for me to pay 100.00 per month til it as paid off. I paid 1900.00 over the next 19 months, but was in a car accident and stopped paying it. I received a Notice of stipulation default which gave me 10 days to pay it. I called and asked if I could pay 400.00 in eleven days and 100.00 per moth after and they said call back when I had the 400.00. Now, ten days later I got A Motion for Entry of Judgement for the remaining 1200.00. They have agreed to accept the 400.00 and 100.00 per month thereafter, but does this new paper mean I will have a judgement in court against me? and does it mean they can get into my checking account?
Linda – It is always a good idea to talk with an experienced debt collection defense attorney about your concerns with collection events that reach this stage (in the courts). Generally speaking, and based on the little you shared, you would end up with a judgment against you. That judgment is a prerequisite to a bank account levy. All of that said, once you have an agreement in place (get it in writing), it is less and less a concern to have any extra ordinary collection efforts take place if you are paying as agreed.
I just received a letter today stating that I lost in a suit with capital one .This was over a credit card dept 23,400. I need to negotiate a settlement with this attorneys office. I need some advise on contacting them. I did watch the video but need more advise. I live in WI. My credit
score is in the tank. I most likely will call you as well. I assume the sooner I deal with this the better.
Thanks
Dan
Dan – You can best schedule a consult using the contact box in the right side bar, or by submitting the longer form here.
Did you defend the lawsuit?
Michael,
I have settled three credit cards. As you may already know, when settling i had to give the debt collection agencies my bank account number. During the time that i was settling i kept whatever extra money i had “someplace else” for lack of a better word. Now that i have settled and the agreed upon amounts have been paid do you think i can go back to using my bank account or is that not wise? I have even received Form 1099-C, Cancelation of Debt from the credit cards. I don’t want to wake up one morning and see whatever i am able to save being wiped away.
I have a bank account with BoA and two of the credit cards i settled were BoA credit cards.
Your feedback is always appreciated,
Thank You
Adie – You should not have any issues with using your bank account. Hopefully you have each settlement you did documented in written agreements, and have proof of payment readily available too. These will help you if anything weird happens from here.
Not for you, but for other readers: I do recommend you set up a specific bank account, even at the same bank, just for use during the time you are negotiating and paying off settlements.
Hi, I live in California and several years ago lost my job and was forced to take SS early, I have no job or income or assets, I was unable to continue to pay my credit card debts and now just received a letter from a law group that states unless I despute this amount within 30 days they will get a judement against me and will mail it to me, I am very upset about this and freightened, can you please inform me in what I can possible due, I barely make ends meet now and am afraid they will garnis my social security.
Thank you for your help.
Sherry – The letter wording is what is often referred to as a mini Miranda in debt collection. It is worded the way it is for CYA purposes (keeps um out of trouble). If you read it carefully you should see it says something like “if” there is a judgment, which is to say if you already have a judgment against you. In other words, they cannot just go get a judgment. They have to sue you first, and that is a process.
If that attorney collection letter you got is from an attorney licensed in your state (has an address in your state is a good indicator), you are at a high risk of being sued for collection. But even with a judgment, your social security cannot be garnished from the source (directly from the government before it hits your bank account), and if your SSI goes to an account that is not mingled with any other non exempt money (wages, gifts etc), the money is protected their too.
What is the amount they are trying to collect from you? Do you have other unpaid bills out there? If so, what is the total of all those bills?
Hi Michael, thanks so much for responding, the debt amount is $2,624.32 and yes I have more debt all totaling around $5,000.00, during the recession lost my job and haven’t worked since and was forced to take my SS early so have been unable to pay those debts. The company that sent the letter is Winn Law Group who states this law firm is a debt collector, as defined by 15 u.s.c. s1692 (a) (6) and this is an attempt to collect a debt, any info will be used for that purpose, they are in California as I am also. They also state if you notify us in writing within the 30 day period that the debt or any portion thereof, is disputed we will obtain a verification of the debt or a copy of a judgment against you and mail a copy of such verification or judgment to you and they will upon my request within the 30 day period provide me with the name and address of original creditor if different from current creditor.
I have no judgments against me that I know of and have not been sued that I know of!!
I don’t work so have no income or assets and no savings or home. Just a little worried about all this.
Truly appreciate all your help!
Sherry
Sherry – Thanks for the additional details. Sounds like no lawsuit has been filed, but one may be. If you are served a lawsuit, post an update to this comment string and lets go from there. If you are concerned about receiving a legal sounding collection letter from an attorney, I would encourage you to look up a low income legal aid office in your area, and ask their opinion.
My account has been levied by the Sheriff Department because I was sued by Cache LLC. I never got a letter to appear in court but was told by Cache attorney that I was properly served because the papers were served to my sister. My money from my checking and savings has been taken and I don’t know what to do from here. I tried contacting the attorney for Cache but spoke to a rude person who told me I couldn’t and won’t get my money back and will continue to do what they have to until the balance I owed is paid off.
– What are my options and what should I do now?
lou – When things advance to this point, you want to see what can possibly be done to undo the judgment, or accept it, and resolve the debt. If you want to try to undo something like this you need to be talking with an experienced debt defense attorney. If you want to resolve it, what is the remaining unpaid balance, and what are you prepared to do by way of settling it in a single lump sum, or can afford in monthly payments?
Michael,
Throughout 2013 I was trying to settle three credit cards, BoA, Chase, and Discover. I discovered your website by accident and it was the best thing that ever happened to me. You were very prompt answering all my questions and any doubt I had along the way. Credit Card debt , i know for a fact, can be very overwhelming and if you don’t know how to approach the situation it can be devastating.
I personally wanted to thank you for everything that you do. Your help and guidance was the best thing that happened to me in 2013. With your prompt feedback I was able to avoid two lawsuits, and most importantly, I knew how to negotiate with debt collectors and the expected outcome.
Thank you very much
Adie – You made my day with your post. I am glad I could be a part of your success!
Hi, I’m in Florida…
can a summary judgement allow them to come after your wife’s accounts ?
can head of household or homestaed stop them from touching principal property ?
thanks.
avner – You do have head of household exemptions in Florida, and great property protections if you are living in the home. Can you be more specific with what is going on and who you are dealing with?