I hope you are not looking at a judgment and are just asking this question for the sake of curiosity. However, if you believe you will be facing a legal judgment, it is essential that you do your research and understand the mechanics of a judgment – before it happens, during the process, and afterward.
In point of fact, a judgment is the final effort of a creditor to collect a debt owed. Prior to reaching this point, many things have likely transpired. To begin with, you have entered into an agreement with a creditor to purchase an item and pay for the item at a later date, normally through installment payments. Or, alternately, you may have purchased an item using a credit card and, subsequently, owe the credit card company for the funds, or credit, fronted for the purchase of the item.
Excited about your purchase, you drive home anticipating the benefits and enjoyment you will receive from the purchase. Unfortunately, the economy is so poor that two weeks later not one, but both, of your grown children and their families move home because they cannot make ends meet. Your kids are confident that they will be able to recovery financially within two or three months; however, eight months later they are all still there and you are financially over-extended. You have been unable to make a payment on your purchase for the past four months and your creditor is now sending letters and calling constantly.
The first step a creditor will normally take is to contact you in an effort to negotiate a plan to bring your payments current. Often, you will find your creditor understanding and sympathetic of your plight. However, as the weeks and months march past, he will likely become less understanding and sympathetic. Your creditor will most likely reach a point where he is tired of using his money and time to try and reach an agreement with you. At this point, he may decide to initiate a judgment proceeding against you in order to obtain payment of the debt owed. A “judgment proceeding” is a legal suit where your creditor will attempt to prove that you owe the debt and will try to obtain a “judgment” against you in order to obtain payment for this debt. (It is important to understand that when you entered into the agreement with the creditor or when you applied for your credit card, you likely gave permission to the creditor or credit card company to sue you in the event that you defaulted on your payments. This “permission” is normally contained in one of the clauses in the contract.)
People unfamiliar with legal matters are often nervous when they receive legal papers, which is natural. They may even consider not appearing in court for the hearing because they are scared to do so. Let me state here and now that it is ESSENTIAL that you show up at the hearing! If you do not, your absence will mean that a default will automatically be rendered in the case. A default on your part means that you LOSE the case and your creditor, with no effort on his part, will automatically win! This will mean that you will be right back at step one again and owing your creditor the debt.
If the case does make it to court and you end up losing, your creditor will be granted a judgment against you for the amount of the debt and you will be served with a Notice of Judgment. This Notice of Judgment will allow you 30 days to pay the debt in full. If the debt is not paid within 30 days, the creditor will be able to take certain actions against you in order to collect the outstanding debt. Some of the legal remedies which the creditor may be able to utilize include garnishment of wages, liens against real property, and seizure of assets.
Your credit score will take a nose-dive if your creditor is successful in obtaining a judgment against you! It is best to contact your creditor early on and try to work out a payment plan. Remember, the only one hurt in a judgment proceeding is YOU!
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