Will I Be Affected by a Judgment?

[court reporting]

Your creditor is sending a clear signal that it is through playing games if you are served with a Notice to Appear in court for a judgment proceeding. You will have 30 days from being served to object to the filing. You can have the case dismissed if you can prove that the debt is invalid.

If a creditor merely threatens to go to court, it may or may not be serious. In any event, you should view going to court as an absolute last resort.

Assuming you owe the debt, the debt is still within the statute of limitations (check your state's statute of limitations laws), and you would prefer to negotiate the outcome instead of going to court, you should make an attempt to contact your creditor. Prior to doing this, you should check your state's statute of limitations laws because, if the debt is beyond the law, making an offer to pay could begin the clock ticking again and eliminate any statute of limitations claim you may have had.

Your credit report will take a heavy blow if the court orders you to pay a debt with an official court order. If you can negotiate a settlement with your creditor prior to entry of a judgment, you will avoid having this negative mark show up on your credit report.
The best outcome would be to negotiate a full deletion of all negative information. If you are successful in negotiating this, make sure you get the agreement in writing and that you obtain the signatures of both parties. Keep in mind that once the court becomes involved, your chances of negotiating a settlement are next to none.

[LegalGuy]

Your post is quite informative. I would suggest that your comment advising debtors to "[k]eep in mind that once the court becomes involved, your chances of negotiating a settlement are next to none" is, perhaps, a bit misleading. Many judges will order parties to attempt a negotiated-settlement to preclude having the case tried in Court.

My advice to debtors is to pay legitimate debts (duh!) and ensure that each item the creditor presents is accurate. Errors in medical billing are legion! Many creditors affix fees that are inappropriate.

While I would certianly agree that such cases are best resolved quickly, debtors should not feel compelled to pay unjust charges simply because a creditor files suit. Both judges and juries are often sympathetic with abused debtors.