How to get a debt collection judgment vacated

March 31, 2010 by Todd Murray · Leave a Comment 

In a collection case, a  judgment is a final court order that you owe the debt collector money. Most collection judgments are entered by default because the consumer didn’t answer the lawsuit.  Having a judgment against you can lead to both bank and wage garnishments, as well as a lower credit score. And while it’s difficult to get the judgment overturned–or vacated–it’s possible in some cases. To get a judgment vacated in Minnesota, you’ll need to bring a motion in front of the court and prove the following four things:

  • A legitimate defense to the collection case. You must show the court that you have a defense to the debt collector’s case. If the debt collector is a debt buyer, you can usually argue that they can’t prove that they are the rightful owner of your account. You may also be able to argue that their evidence is insufficient, that the statute of limitations has passed, or that the judgment balance was too high. You don’t have to prove your defense on a motion to vacate, you just have to show the court that you have a legitimate one. A good consumer lawyer can help you figure out what defenses apply to your case.
  • A good reason for not answering the complaint. There are many reasons for not answering the complaint–you just have to convince the judge that yours is a good one. Perhaps you were out of town when the lawsuit was served and you didn’t come back until after the time to answer passed. Or maybe they left the lawsuit with someone at your house, but that person never gave it to you. Some judges will even accept the argument that you didn’t understand what the lawsuit was and didn’t know that you had to respond to it.
  • That the judgment was entered less than a year ago. To get a judgment vacated, you have to show that you acted quickly once the judgment was entered. Courts have generally ruled that you have 1 year from the date that the judgment was entered to bring a motion to vacate. There may be an exception to this rule if you didn’t even know about the judgment until after a year had passed. A consumer lawyer can help you determine if your case fits into this exception.
  • That the debt collector will not suffer any prejudice if the judgment is vacated. In most cases, the only prejudice that the debt collector will suffer if a judgment is vacated is having to take the time and spend the money to litigate the case again. But Minnesota courts have been very clear in ruling that additional time and expense are not sufficient prejudice to prevent a judgment from being vacated.

Also, if you weren’t properly served with the debt collector’s lawsuit, the judgment should be void. In Minnesota, a lawsuit begins upon service. So if there was no service, there wasn’t a lawsuit. And if there wasn’t a valid lawsuit, there can’t be a judgment. Talk to a consumer lawyer if you believe that you weren’t properly served with the collection lawsuit.

If you live in Minnesota and want help trying to get a judgment vacated, feel free to contact me for a consultation.

(photo: taberandrew)

What should I do when a debt collector gets a judgment against me?

February 24, 2010 by Todd Murray · Leave a Comment 

In a debt collection case, a judgment is a court order that you owe the creditor money. A judgment gives the creditor the power to garnish your bank account and wages. It has a negative impact on your credit score. And in some cases, creditors will exercise their post-judgment power to seize some of your personal property and have it sold to pay the debt. Having a judgment against you is an unpleasant situation to be in and is one of the main reasons why it’s so important to answer the summons and complaint. If a creditor has a judgment against you, here are some of your options:

  • Consider a motion to vacate the judgment. If the judgment was obtained by default, you may be able to bring a motion and eliminate the judgment. This will give you a chance to defend yourself. Think of it as a do-over. But you’re only able to get a judgment vacated in very limited circumstances. A consumer lawyer can help you decide if a motion to vacate is right for your case.
  • Negotiate a settlement or payment plan. If a motion to vacate the judgment is not appropriate in your situation, your options are pretty limited because the time to dispute the debt has passed. In many cases, your best choice may be to engage the creditor and arrange for payment. That may be the only way to avoid the stress and inconvenience of garnishments. Good deals are hard to come by after judgment because you’ve lost most of your leverage. But if you can demonstrate a significant financial hardship, or have a lump sum of cash available, you may be able to get the creditor to knock a decent chunk of the balance off.
  • Remember that the FDCPA applies even after the judgment is entered. So keep a record of all the conversations you have with the debt collector and save all letters and voice mails from them. And if you think that a debt collector has violated the FDCPA, consider talking to a consumer lawyer about the situation.
  • If all else fails, bankruptcy may be your best option. If the judgment is for a significant amount of money, or if you have multiple judgments, your best choice may be bankruptcy. Consider talking to an experienced bankruptcy lawyer to figure out whether bankruptcy is right for you.

If you live in Minnesota and need help with a debt collection judgment, feel free to contact me to discuss your case further.

(photo: Xurble)