Daily Archives: October 13, 2011

What Happens If I Get A Judgment Against Me?

Empty Pockets

“I am being sued by capital one for a credit card debt…I’m unemployed…will I still have to pay if I lose in court?”

Someone posted this question to me.  I never know what the enemy may do, but, here are the possibilities:

So here comes the long winded answer about money judgments in St. Clair Shores and everywhere else in Michigan.

For a creditor, bank, credit card company, whoever, to get a judgment against you, they have to sue you in a court.  The court has to be in the city or county where you live.

Bankruptcy stops lawsuits, so, if you file, that is the end of the lawsuit.

If not, you have 21 days if served personally, or 28 days if served by certified mail, to file a written answer with the court.  You, not the court, also have to send a copy to the lawyer suing.

If you do not answer within the allowed time, you get no more notice of proceedings in the court.  The court assumes you have chosen not to participate.

A default judgment will be entered against you.  That is a paper the judge signs that says you owe the money.  The significance is, after the appeal time runs, your wages can be garnished.  In Michigan, they can also get bank accounts in your name and state, not federal, tax refunds.

The court can issue an execution on the judgment, against non-exempt property.  A judgment lien can be recorded against your house.  This lien is behind government liens, like property taxes, and mortgages.

Garnishment and execution papers are supposed to be served on you as well.

The judge can stop a wage garnishment based on a default judgment if you file a petition for partial payments and it is granted.  The motion must show your income and living expenses, and how much you can afford.  If you get the order, you pay the amount you asked for TO THE COURT.  As long as the money comes in, the court will not issue any further wage garnishments.

This discussion assumes you do owe the money and have no defense to the lawsuit.  If you do have a defense, you might win a trial and not have a judgment against you.

It is not a defense that you do not owe the money.  The only issue for the court is, is there a contract and did you breach it?

If yes, then it is just a matter of figuring out how much you owe.

photo credit daniel moyle

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