Judgment Meaning & Definition

What is a judgment?

A judgment is a court ruling used in a variety of civil lawsuits that can be issued in a debt lawsuit. If you owe unpaid debts and a creditor sues you to try to get paid, the court might make a judgment against you. If you don’t show up in court to defend yourself, the judge might make a default judgment, which is when the creditor wins automatically. 

A judgment against you could have serious consequences, including a frozen bank account or garnished paycheck.

Key concept: A type of court ruling that can be issued in a debt lawsuit or other civil lawsuit.

More on judgment

It’s best to try to avoid having a court judgment against you in a debt lawsuit. If debt collectors are contacting you or you think you might be facing a debt lawsuit, try to solve the debt problems before you get to court. 

Some creditors may negotiate your debts for partial payment instead of going through the expensive process of taking you to court. Talk to an attorney experienced in your situation for legal advice about your circumstances. Debt lawsuits can often be challenged and, if successfully defended, dismissed. 

Judgment: a comprehensive breakdown  

Court judgments are used in a variety of civil lawsuits. If you’re struggling with financial hardship and facing a debt lawsuit, that lawsuit may result in a judgment. If you can’t pay money you owe a creditor, after enough time passes, the creditor or a debt collector might decide to take you to court. Court judgments for credit card debt lawsuits and other delinquent debt don’t happen overnight, but they could bring serious consequences. 

Here are a few things to know about court judgments for overdue debt.

Lawsuits are typically for seriously delinquent debts

If you can’t make a minimum payment on your credit card this month or fall a few days late on another debt payment, don’t worry—you’re unlikely to be sued. Creditors and lenders usually only bring debt lawsuits for debts that are seriously delinquent, generally more than six months overdue. 

Additionally, not every overdue debt ends with a lawsuit. If you’re not seriously overdue on your bills, you likely still have other ways to solve your debt problems. For example, you could work out a repayment plan with your creditor or get debt relief. 

Debt collectors may have the right to sue you 

If you're being contacted by debt collectors, they might threaten to sue you. This isn't always an idle threat. Debt collectors may have the right to sue you for unpaid debts, even if they’re not the same company that you originally borrowed from. Debt collectors that buy your overdue debt from a bank, credit card company, or lender could have the right to sue you for payment. 

Always respond to a court summons 

If you receive a court summons in the mail, don’t ignore it. You have the right to ask debt collectors to stop contacting you, but you don’t have the right to ignore a judge. Showing up for court is the best way to tell your side of the story and challenge the validity of the debt. 

You may even get the case dismissed if you can successfully dispute the debt. Here are a few reasons your debt lawsuit could be dismissed:

• You don’t actually owe the debt

• The amount of the debt is incorrect or there are other errors

• The statute of limitations for bringing a lawsuit has passed

Ignoring a summons doesn't make the lawsuit go away, and it often means giving up your chance to defend yourself.

Not showing up could lead to a default judgment

If you don’t show up for court, the judge could automatically rule in favor of your creditor. This is called a default judgment, because one side of the legal case wins by default. You give up your right to defend yourself when you fail to show up in court. 

A default judgment could give your creditor the power to take the maximum amount of money or property from you. The better strategy is to try to negotiate your debt with the creditor before your situation turns into a court matter.

You could face bank account levies or wage garnishment 

If the court issues a judgment against you, your creditor may now have the legal right to get money from you. A court judgment could allow your creditor to put a levy on your bank account, which freezes your funds until your debt is paid. Your creditor could also be allowed to garnish your wages, which is when money is taken from every paycheck and sent directly to your creditor. Rules and limits may protect some of your money, even after a court judgment. 

This content is for informational purposes only and is not intended to be financial advice or legal advice.