Settlement After Judgment

Consumer Protection Lawyer

If you or a loved one is trying to settle a judgment obtained by a creditor, you should speak with a consumer protection lawyer. They know how to help you understand and appreciate your legal options. Fitzgerald & Campbell has a lot of experience taking on creditors on behalf of debtors. We are here when you need us. Contact Fitzgerald & Campbell for a free consultation by calling (844) 431-3851 or contacting us online.

After a judgment has been rendered against you, fortunately, you may still be able to get the creditor to agree to allow you to pay less than the total amount owed. This can be done by entering a settlement agreement, in which an attorney can be of great assistance. This article explains the possibility of settlement after judgment. 

What Is A Judgment?

A judgment occurs when a party loses a civil case either by default (not showing up) or at trial. The court will issue a judgment which is essentially its final decision. If the judgment is for money, the defendant will be ordered to pay the money to the winning side. 

How Long Can A Judgment Last?

A judgment is valid in accordance with California Law for ten years, after which it will automatically expire. However, a judgment can be extended for another ten years at the creditor's request. 

What Is The Amount Of Interest On A Judgment?

Under California Law, interest accrues at 10 percent per year on the principal amount of a monetary judgment remaining unsatisfied. After ten years, the judgment is effectively doubled upon renewal, so it's best to pay it as quickly as possible. If you don't have the full funds on hand, this can be done via a settlement. 

What Power Does A Creditor Have After Judgment?

Once a court enters a judgment against you, the creditor is called a "judgment creditor," and you are called a "judgment debtor." Judgment creditors have many more collection techniques than creditors trying to collect debts before getting a judgment. These techniques can include taking wages directly through your employer ("Garnishment"), putting a lien against your property, or getting the Sheriff to take or sell your personal property ("Levy").

What Is A Settlement?

A settlement is an agreement by both parties to the lawsuit that resolves their dispute. This usually occurs before trial but can occur after trial in some instances. 

Can I Settle After A Judgment Has Been Rendered Against Me?

Yes, if you have been delivered a judgment awarded against you by a debt collector, you should still be able to reach an agreement to avoid garnishments or bank levies. Settlements can be negotiated at all stages of the collection cycle, although it is always best to settle before judgment because the debtor's power is more limited.

Why Would A Creditor Agree To Settle With Me After A Judgment Has Been Entered?

If you attempt to negotiate before the creditor has taken measures such as garnishments and land levies against you, this is an advantage as it's more work on their end. If it is difficult for the creditor to enforce the judgment against you, they will be more inclined to negotiate a settlement. This is where it is beneficial to have a California debt collection attorney's assistance. Instances that would create difficulty for the creditor to collect are: 

• You don't have traceable employment with a W2 or other tax form to garnish.
• You don't have a bank account in your name or a very small bank account, so a levy on your bank account cannot be made. Note that if you must keep an account open, be aware of when bank account levies can occur. This is usually at the beginning, middle, and end of the month. You may want to elect to have paper checks issued by your employer to time your deposits to avoid levies until the judgment debt is resolved.
• You don't own real property for a lien to be filed, or the lien was filed yet remains unpaid.

What Are The Benefits Of Settling After Judgment? 

It is beneficial to settle after judgment because you can reduce your payments and, ideally, not pay for the entire ten years. With the interest rate being 10% per year, you are paying double the debt if you do wait the full ten years, which only increases if the payments are extended to twenty years. 

How Do I Go About Negotiating A Settlement After A Judgment Has Been Issued Against Me?

1. Step One:  Figure out who you need to pay. You can do this by getting a copy of your judgment from the court where it was entered and calling the law firm that handled the lawsuit. The creditor might have taken the account back from the law firm, and you will need to contact the creditor directly. If the creditor has sold your debt to a third party, you must call them. The bottom line is that you must figure out who is responsible for the debt collection so you can negotiate with them. 
2. Step Two:  Once you have figured out whom you need to talk to, call that person and find out your balance. To know your balance is correct, you should calculate it yourself. To do so, read the copy of your judgment closely: it will have the exact amount owed as of the date of the judgment and interest and legal fees to be added. That number is the amount you owe. 
3. Step Three: Attempt to negotiate with the creditor to pay a lower balance. An attorney would be helpful at this stage. Be prepared because creditors are expert negotiators. Be aware of whatever facts are in your favor.

How Can A California Debt Resolution Attorney Help You?

If you already have a judgment against you that you wish to settle, a debt resolution attorney can be invaluable in obtaining a settlement post-judgment through negotiation. The attorneys at Fitzgerald & Campbell are highly experienced and have helped many individuals successfully navigate the ins and outs of debt judgments. To get started, reach out to Fitzgerald & Campbell for a free consultation by calling (844) 431-3851 or contacting us online.