What is a Default Judgement?

A default judgement most commonly occurs when you ignore a debt obligation that has gone into collections with a law firm. Aggressive collection activity was pursued and the law firm took legal action (you should have receive a summons to go to your local country clerk office). Default judgements most commonly occur when consumers simply ignore the summons they received. This is part of the reason why creditors sue in the first place.

Although at the time you might be frightened and not know what you should do, doing nothing is typically the worst thing you can do. It leads to an automatic loss, hence the default judgement. Taking some action regardless if it results in a definitive win is much better than no action. A very high percentage of litigated accounts automatically go into default judgement and in this scenario the creditor automatically wins. They are awarded the balance in full with all associated legal fees and costs.

What Should You Do If You’ve Received a Summons?

If you received a summons you have a few different options. The first and typically easiest option would be to reach out to the creditor directly and try to negotiate a settlement for less than the full balance. If you are successfully able to come to amicable terms with the creditor you can setup a payment arrangement to pay the account off without having to appear in court. The next option would be to appear in court and go to trial regarding the debt. There are valid defenses to be had but it’s also important to understand what kind of state you live in (do the laws favor debtors or creditors, etc.,) and whether you have a valid argument to not pay the debt.

How Do You Avoid a Default Judgement?

The best way to avoid a default judgement is to respond to the summons regarding your debt obligation as soon as you receive it. When responding, the county clerk should be able to help you pick a valid response, but it helps to know what your plan of action is. Since you’ve responded to the summons you cannot get a default judgement against you, however you now have to decide if you want to fight the debt in court or try to settle outside of court. At this point you should also check whether or not you have a date on the court case. If there’s no date, you still have a good amount of time to take action. Now that you’ve responded you can look to secure a settlement with the creditor. Once you settle you’ll typically have a stipulation you need to sign with creditor. After successful competition you’ll have paid the debt off and will have avoided a judgement.

What Are Your Options If You Receive a Default Judgement?

If you have a judgement against you on a debt you owe you can still reach out to the creditor and try to negotiate a settlement on the judgement. The terms of the settlement might not be great since you’ve already lost the case but the creditor might still work with you and you could potentially vacate the judgement if there was an issue with service and receipt of the summons (there are guidelines that have to be adhered to for service of a summons to be valid). Reaching out to the creditor or law firm is going to be your best bet after a default judgement has already passed. In many scenarios you can still try renegotiate the terms of settlement but it’s better to try to avoid this situation altogether whenever possible. The last thing you want is an automatic loss just because you didn’t respond to a summons, so make it easier on yourself in the future and don’t ignore important paperwork, not matter how nervous you might be!