How to Delay a Judgment for Nonpayment of a Credit Card

A judgment on unpaid debt should be avoided at all costs. A judgment stays on your credit report for up to 10 years and, in many states, can be renewed for additional years. A judgment allows the creditor to garnish your wages, intercept your tax refund and withdraw money from your bank account. If you are facing a judgment, you have a couple of options to delay or stop the process. You must be proactive and try to settle the debt as soon as you are made aware of the impending judgment.

Instructions

Settle the Debt

1

Prepare to contact the lender. Determine the amount you have available to settle the debt. Expect to deal with an agent who is not prepared to budge. The lender is trained to negotiate and is trained in aggressive collection techniques. Remain calm and go into the call knowing you may have to hang up without reaching a settlement agreement.

2

Contact the creditor holding the credit card debt. Request to speak to someone who can work with you to arrange a settlement agreement. Calmly tell the agent you have an unpaid debt that you are unable to pay in full. Tell her you have reviewed your finances and can pay your set amount if she will agree to accept the payment in full.

3

Expect the agent to immediately dismiss the settlement amount and request a much higher percentage. Repeat that you wish to pay the debt but your offer is the absolute most you can pay. If you can afford more, tell the agent this but do not promise more than you can pay. Your goal is to avoid a judgment; and if you can settle, you will avoid the judgment. However, if you are not able to meet a settlement agreement, the lender will proceed to court, and you have gained nothing.

4

Ask for the settlement agreement in writing prior to paying the debt. Never pay over the phone by credit card or check. Only pay after you have a signed letter of agreement.

File for Bankruptcy

5

Meet with a bankruptcy attorney to determine if bankruptcy is an option for you. Bankruptcy should be a last resort as it will cause a devastating blow to your credit. The effects from bankruptcy will last for seven to 10 years.

6

Fill out the paperwork required by the bankruptcy court. The exact paperwork will vary, depending on your state and whether you are filing Chapter 7 or Chapter 13. You will be required to list your income, expenses, your exempt and non-exempt assets and each of the debts you are requesting the court to discharge. Pay the attorney the filing fee and have him file the bankruptcy petition with your local court.

7

Instruct the attorney to contact the lender immediately after the bankruptcy petition has been filed. From the moment a bankruptcy petition is filed, the lender cannot continue with judgment proceedings against you.