What is a Default Judgment and Should I Worry?

If a person owes money for a credit card that they are unable to pay, it is possible that the credit card company could file a lawsuit. Not all creditors file a lawsuit for a defaulted debt. If a creditor realizes a seniors income is protected they might be less likely to file a lawsuit. A lawsuit is filed to establish that a person owes a certain amount of money. Normally, a person is served legal papers, commonly called a summons and complaint, which are presented together. The summons details what the person needs to do if they are going to contest the matter and what happens if they do nothing. The complaint details who is owed and what for, provides the details that prove this, and finally asks for a judgment for a specific amount of money.

The summons will normally say a person has a certain number of days to file what is commonly called an “answer” if they are going to contest the lawsuit. Sometimes there might even be a court date. However, a careful reading will show that the court date is only if the person is going to contest or dispute the lawsuit for money.

Most people will recognize that they owe the money. Importantly, seniors know that their income is protected by law and can’t be taken from them. HELPS protects seniors from unwanted collector contact by phone or mail. However, a creditor can still legally file a lawsuit to establish that money is owed, even after they receive a “cease and desist” letter from HELPS. Why do they do this if they can’t take the senior’s income? That’s a good question. First, the vast majority of creditors don’t file a lawsuit. It is by far the exception than the rule. Sometimes I think that it must be decided by a computer, so it’s nothing more than a step in the collection process.

When a HELPS client tells us they have been served, we send a letter to the attorney who filed the lawsuit advising the attorney that our clients income is protected. The letter also explains that we expect that they will get a judgment. We also call our client and explain why they don’t have to worry. We also send a detailed letter with links to articles and videos from HELPS outlining the process, explaining why they don’t have to worry, and reminding them that they don’t have to go to court.

A person can always contest that they owe a debt. They would have to pay a fee and file an answer. HELPS doesn’t represent persons in court. We explain to seniors that if they owe the money, since their income is safe they don’t need to worry if someone were to get a judgment against them. If you don’t file an answer to contest a lawsuit the creditor will eventually, after the time period allowed by law, submit papers to the court for what is called a “default judgment.” That means a judgment where a person didn’t contest the matter. So the creditor wins by “default.” Thus the term “default judgment.”

That is what a default judgment means. Sometimes seniors are under the impression that if they are sued they have to respond. That is not the case. If they do nothing the creditor will obtain a default judgment.