This post is not written to be legal in nature, otherwise it would be a whole heck of a lot more boring, rather I just want to highlight the basics of a Default Judgment and what to do if you find out there is one on your credit report. I have never practiced in this area, this is no where near an expertise of mine, but rather I was prompted to write this post after helping a couple of my family members, who had a default judgment in their name.
I want to highlight 3 distinct questions, and then I can expand on these areas if questions arise:
- What is a default Judgment?
- How will a DJ affect your personal finances? and
- What to do if you get hit with something like this.
Before we get started, this post is not intended as legal advice, but rather just an introduction into the topic and as a starting point to discuss your situation with your legal or financial professional.
What is a default judgment?
Findlaw, an invaluable resource to those attorneys and non-attorneys, who need a legal definition, defines a default judgment simply as,
a judgment entered by a court after an entry of default against a party for failure to appear, to file a pleading, or to take other required procedural steps
Simply put, a default judgment is nothing more than a judgment obtained because defendant didn’t show up. This is the most basic definition and depending on your particular state there may be a more expansive defintion (i.e. a judgment predicated on a failure to produce evidence).
If you purposefully ignored a subpoena then you have a larger hurdle to overcome, but if you have no idea where it came from then continue to question #2. If you ignored subpoenas and now there is a judgment…get an attorney. Similarly, I implore anyone reading this,
IF YOU GET ANY LETTER FROM ANY U.S. ATTORNEY DO NOT IGNORE IT
Whenever I someone contacts me about a situation like this, I ask for all correspondence from attorneys, if there are any. Our constitution affords us the protection of Notice of any suit which is brought against a citizen as such every state has some sort of law associated with notice/service of a subpoena. Some states let you do a nail and mail (i.e. affix subpoena to the door and then mail a copy – NY Language), some do not, some let you serve people at work, some do not.
How does a DJ affect your personal finances?
A simple google search of Credit Report and Judgment provided a great wiki answer,
The Fair Credit Reporting Act [15 USC Section 1681c]
(a)Information excluded from consumer reports…
(2)…civil judgments…that from date of entry, antedate the report by more than seven years or until the governing statute of limitations has expired, whichever is the longer period.
So, 7 years from the date of entry, or longer, if your state has legislation which allows it report longer.
Here is input from others:
* A judgment remains on a consumer’s credit report for 7 years from the “date of entry, or until the governing statute of limitations has expired, whichever is longer”. This time period applies to each legal action. Under certain circumstances and certain state’s laws, judgments can be renewed. The renewal of a judgment would allow it to show on a credit report for 7 years from the date of renewal, if allowed by state law.
* Generally seven, although most judgments are renewable in which case it could be on a cr a very long time. If paid it would be listed as “satified” and be expunged after the 7 years expired.
What do you do if you find out there is a Judgment out there?
Call a licensed attorney and get your butt down to the court house where the judgment was issued and see the pro se department.
Anyone have any experiences?
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how does or who reports default judgments to credit reporting bureaus?
Sorry for the delay! It is usually the creditor who will report the outcome of a judgment (default or otherwise) obtained by an attorney
Question I won a personal judgment against a landlord and the judgment was filed with the court how long will that judgment stay in effect.
@ Robert,
Judgments differ from state to state. My recommendation would be to contact the sherrif’s dept in the county you received the judgment and start asking questions.
In New York, a judgment is good for 10 years (or at least it was when I was studying for the bar).
What about me, the one who asked for the judgment against someone who owes me money? What happens to the person who said they owed it and would pay it, now I have to pay for it? What can I do to get my money back?
@Tonya,
To get your money back you are going to have to sue the person to obtain the judgment. For all intents and purposes, a Default Judgment (the point of this post) only happens after you file a lawsuit and the other person doesn’t show up.
So depending on the amount and your relationship with the debtor…get your butt into court. Many states, municipalities, villages, etc. have some sort of small claims system where you won’t need a lawyer.
We have a lawyer (albeit not a great one) who was supposed to go to court a couple of weeks ago to file the judgment. Assuming he has or will, what will we do then? Will a judgment be a means to getting our money back, or just if he tries to buy something?
@Tonya,
1) Where do you live? If you are in the NY area I can probably recommend someone (NOT ME).
2) If you have hired a lawyer, he first needs to obtain a judgment. This does not mean he can walk in and demand one from a judge. The other side might have fought back, the other side might have gotten a lawyer themself. There are a million different things that could have happened.
3) Once a judgment is obtained, in most states, it then needs to be filed. That is a state to state procedure, but one that your lawyer SHOULD handle.
4) Once filed with the proper authority (i.e. a sheriff) that sheriff can then go seize bank accounts, put a lien on a piece of property, garnish wages, etc.
The most important thing is – CALL YOUR LAWYER! Open communication with those professionals in your life is HUGE.
Thank you for your help. My husband talked with him today and he is moving in the process.
Let me know how it goes! Keep us updated…
I sure will.
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[...] 100,000 default judgments due to bad service. When I wrote a post way back in December about Default Judgments and How they Affect your Personal Finances I skipped over service of the papers to start a [...]