THREE Ways To Deal with Your Default Judgment! (2022 Update)

TL;DR

If you find yourself with a default judgment in a debt collection case, you have three options: fight it, settle it, or consider bankruptcy.

Transcript

hey everybody John skiba here from the consumer Warrior YouTube channel and in this video I'm going to talk about as kind of a follow-up to a recent video I did on the number one thing you need to do when you get sued by a debt collector I talked about how 95 percent of people don't file a written answer with the court and they end up with a defaul... Read More

Key Insights

• 👯 Default judgments in debt collection cases are common, with about 95% of people not filing a written response.
• 😫 Improper service of the complaint and summons can be grounds for getting a default judgment set aside.
• 💁 Settling a default judgment can be a viable option, especially if the debt is the tip of the iceberg and there are other financial issues.
• ⚾ Bankruptcy can be a "nuclear option" to eliminate the debt and void the judgment, but it should be considered based on the individual's overall financial situation.
• 🤝 Seeking legal advice and assistance is recommended for dealing with default judgments in debt collection cases.
• 🆘 Properly responding to a debt collection lawsuit can help avoid default judgments and their consequences.
• 🥺 Default judgments can lead to wage garnishments and difficulties in purchasing property or securing loans.

Questions & Answers

Q: How common is it for people to not file a written response to a debt collection lawsuit?

According to the video, about 95% of people who get sued by debt collectors do not file a written response with the court.

Q: What is the first step to fight a default judgment?

The first step is to file a written motion with the court to vacate the default judgment, usually under rule 60 of the local rules of civil procedure.

Q: What evidence can be provided to show improper service?

Evidence such as the affidavit or certificate of service filed by the creditor or process server can be obtained from the court. Other evidence, like records of being out of town or incarcerated, can also be used to show that proper service did not occur.

Q: Is settling a default judgment a good option?

Settling a default judgment can be a quick way to resolve the issue, but it usually requires paying a percentage of the total balance. It is important to settle before wage garnishments or bank levies are in place.

Summary & Key Takeaways

• Many people who get sued by debt collectors do not file a written response with the court, resulting in a default judgment against them.

• Default judgments can cause wage garnishments and other financial difficulties, and many people are not even aware of them.

• There are three options for dealing with a default judgment: fight it by showing improper service, settle it by negotiating a lower amount, or consider bankruptcy to eliminate the debt.