Can a Money Judgment Be Negotiated?

Consumers who hold debt without paying can be sued, and typically are by credit card companies and mortgage lenders. When a creditor takes a debtor to court and receives a favorable verdict, the result is called a "money judgment." The money judgment is how the court tells the debtor to pay and tells how much is to be paid to the creditor. The judgment is typically in the amount of the debt, but the debtor is free to make attempts at resolution, which include negotiating the actual debt. Agreeing to pay the debt and making arrangements that are satisfactory to both parties is called "voluntary compliance," and will stop further legal proceedings against you.

Debtor Obligation

Once a money judgment has been entered against you, you are compelled by the law to resolve the judgment. If you do not comply, the judgment creditor can pursue you with the full support of the law, including a lien against any property assets you have and a levy against any cash assets and/or wage garnishments.

Resolution

Resolution of the money judgment is not limited to simple payment of the amount ordered. Resolution simply means that a financial arrangement was made and satisfied. The arrangement can be in the form of monthly payments or a smaller amount than ordered.

Financial Offer

An offer can be made by contacting the judgment creditor and laying out details of what your financial situation is, what you are able to pay and what your plan of payment is. If you make it clear that you have limited finances, the debtor is more likely to accept monthly payments or a smaller amount which he knows he will get, as opposed to the money judgment that he may have to go to great lengths to enforce.

Secure An Agreement

Once an offer has been accepted, the offer and its terms should be spelled out in a letter from the judgment debtor. That way, if he tries to enforce the full amount of the money judgment later, you have proof that a negotiation was made and accepted by both parties.

Pay the Offer

When the offer has been made, accepted and placed in writing, it is important that the agreement be adhered to. If you agree to make monthly payments and fail to do so, the judgment debtor can pursue you for the full amount of the money judgment as if no payment agreement was ever made.