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A Court Judgment Doesn’t Necessarily Mean You Have to Pay Your Debt

By Benjamin Platt, Contributing Writer

If your creditor sues you over a debt and you go to court, the judge could rule in their favor and issue a judgment against you, but that doesn’t mean the end of the road. Not by a longshot. Judgments can be fought. They can be negotiated. They can be contested. In fact, some analysts estimate that as many as 95% of judgments that are not collected immediately never get collected at all.

So stick with us and let us teach you how to thwart a creditor judgment. And come on, who doesn’t love a good thwarting?


What judgments are and aren’t

Let’s start with what judgments are not. They’re not money. When a judge issues a judgment against you, they don’t then head over to your bank and empty your account to hand over to your creditor.

Rather, when a creditor sues you and wins, the court issues a judgment to the creditor. (Key tip: if you get sued by a creditor and you don’t show up in court, you lose by default and the creditor will get the judgment automatically, so always respond to a lawsuit). The judgment is simply a document that says you owe your creditor an amount of money. As DebtCleanse founder and author Jorge Newbery put it, “A judgment is just a piece of paper, kind of like toilet paper but less useful.”

In other words, a judgment is a debt. And debts can be fought.

We’re not suggesting that a judgment should be taken lightly. They’re not a joke. Like any court proceeding, they are a serious matter. Depending on the laws of your state, a creditor who has a judgment against you may be able to take money from your accounts, garnish your wages, or even seize your property. Just like a default on a debt, a judgment generally stays on your credit report for 7 years, assuming the creditor does not renew the judgment. But judgments are also the start of a journey, not a final destination.


Learn how DebtCleanse can help clear your debt for potentially pennies on the dollar.


Follow the paper trail

Okay, so a judgment is a debt. Why is that a good thing? Because debts require documentation, and the law requires that the documentation be perfect. And it almost never is.

The ultimate goal in contesting an unaffordable debt is to get the creditor to agree to resolve the matter for as little as possible. There’s no question that, once a judgment has been issued against you, you are in a weaker negotiating position that you would have been otherwise, but you can still force your creditor to negotiate all the same.

Traditional debt settlement companies will tell you to stop paying your unaffordable debt to try to force your creditor to accept a lump sum settlement. They usually target a repayment amount of 50-70% of the original debt (plus they charge 15-20% of the settlement amount). At DebtCleanse, we think you should aim for a repayment of just 5-10% of the original debt. That’s because stopping payment is just the first step in the DebtCleanse system.

The next step, the heart of our system, is identifying deficiencies, discrepancies, and mistakes in the debt paperwork. And when you’re dealing with a judgment, there could be two sources of these deficiencies: errors your judgment holders made, or errors made by the court and its clerks.

If you find one incorrect figure or date, or one improperly signed form among all the paperwork, is that going to erase the whole judgment? Probably not. But every error you find strengthens your bargaining position and weakens theirs. Once these deficiencies are found your attorney can start to make life quite uncomfortable for your creditors, and the more uncomfortable your creditors, the more you could see that one-time payment amount drop.


The birth of the system

Jorge Newbury created DebtCleanse after seeing firsthand what finding deficiencies could do in his own fights against unreasonable judgments.

When his finances collapsed in the wake of a natural disaster that wiped out his investment properties, he was sued by Belfor USA and ended up on the receiving end of a $310,000 judgment. By capitalizing on Belfor’s deficiencies, he ended up paying just 22% of that amount.

He was also hit with a $5 million judgment to Key Bank that, after fees and penalties, rose to $9.3 million. Jorge and his attorney scoured all the documentation for deficiencies and used them to eventually reach a settlement for a lump sum of just 5.3%.

If you could pay 5.3% of your debt all at once to be rid of it forever, wouldn’t you?


Take action against judgments

Click here to download a free chapter from Jorge’s book all about combating debt collectors and judgments. You’ll learn all the most common stops on the road to settling for a fraction of the original amount, and useful tactics to use along the way. Such as:

  • Step one: Ignore collection efforts. The creditor (or their lawyers or collection agency) will likely contact you to offer to set up a payment plan. Reject it and counter with a lump sum offer of no more than 10%.
  • Step two: Debtor examination or citation. The judgment holder will likely reject your offer and instead serve you with something called a debtor’s exam or citation, where they will examine your finances. Like anytime you’re summoned to court, you must show up. Your attorney can help you respond to the exact scope of their inquiry without giving them anything extra, and can prevent them from overstepping their bounds in court.
  • Step five: Identify deficiencies. An attorney familiar with the DebtCleanse method can help you find the little mistakes in judgment paperwork that can translate into massive savings.
  • Step seven: File suit against the judgment holder. Those deficiencies may create actionable offenses that could justify pursuing damages of your own. Your attorney can advise you if the errors could give you cause for your own legal action. Filing your own suit puts the judgment holder on the defensive and gives you the opportunity to do discovery that could uncover even more deficiencies.

DebtCleanse premium members get access to a nationwide network of attorneys familiar with the DebtCleanse system of spotting and capitalizing on deficiencies. DebtCleanse members also receive one phone consultation, and document review, every month, as well as 25% off on additional legal services if you retain your DebtCleanse attorney.

So if you’re facing a judgment, don’t just accept it, and definitely don’t ignore it. Fight back with DebtCleanse. 

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