What You Need To Know About Judgments and Debt Collections

Business General

For some people, their debt is no longer a matter between just them and the original creditor or debt collection agency. There are judgment debts and this is when the debt collection agency takes you to court over the debt and if they win there are several methods of debt collection following the court judgment. Up to 25% of your paycheck can be garnished by creditor in an effort to receive funds you owe. Another option is to put a lien on your home or car, which means that you would have to use funds from the sale of the car or home to repay the debt. Keep in mind that after a judgment takes place, your debt will be high due to the court expenses associated with the litigation on the part of the creditor.

How Can I Pay My Judgment Debt?

Your first option would be to pay out the entire amount by the date listed but if this will not work for you, you can request an installment plan to pay down the debt. If you’re able to do so, you can have your wages garnished to ensure for a speedy payment of the judgment that is against you. If you feel you’re going to be late with your judgment payment, you need to contact the creditor immediately to get an extension on the due date to avoid late fees or other problems. Another thing you can do is pay more than the required amount each month if you’re able so that the debt will be paid quicker.

filed judgement

Understand Your State’s Debt Collection Laws

If you were sued by a creditor and you now have a debt judgment that needs to be paid, you should be aware of both your state and federal laws as it relates to judgments and debt collection because this helps you be informed of your rights as a debtor. You can contact a lawyer in your area or visit the websites of lawyers in your state who have advice blogs on this topic. Your creditors cannot resort to harassment, threats or other questionable practices in order to collect debt and they cannot garnish your wages before informing you of this possibility.

Conclusion

To avoid dealing with litigation from creditors in the form of a judgment from the court, it is best to pay on your debts in a timely manner each month and if you’re struggling to pay the debts, call or write to the creditor to see if you can change the payment plan based on what you can afford. When you do this is becomes easier to reduce debt and you’ll have a better relationship with the creditor. If necessary, boost your savings each week so that you’ll have adequate funds to pay debts during emergencies and avoid judgments against you by creditors. You can hire a credit repair agency while paying off the judgment debt so that you cut down as much debt as possible and receive counseling on how you can remain debt free after you pay off what you owe.

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