Dealing with a Judgment: To Vacate, Settle, or File

One of the most important things to understand before you decide to file for bankruptcy is that you have options. Even if your financial concerns are severe, you can still whether to choose file or to deal with your money troubles in another way. Continuing to ignore your problems and allowing them to get worse is even a choice – though it’s not one any financial expert would ever recommend.

Determining which of your choices is best for you requires you consider your goals and the situation in which you currently find yourself.

For instance, are you trying to save your home but you’re behind on your mortgage? Are you so deep in credit card debt a creditor has filed a judgment and you aren’t sure what to do next?

We can help, but first it’s important to understand your options.

Vacating a Judgment

Any time a judgment has been filed against you it means your financial situation has progressed far enough that legal action has been taken. A judgment gives creditors the authority to garnish your wages and take other aggressive action against you in an effort to collect what you owe them.

One of your options for dealing with a judgment could be to try to vacate the judgment, but your success in doing so depends on the legitimacy of the debt.

Keep in mind, winning the motion to vacate the judgment doesn’t mean you won’t need to pay the debt. It only means you can fight back against the lawsuit. But if the debt is legitimate, you’ll eventually lose the case against you and still owe the full amount – not to mention the fees now associated with your efforts.

Settling a Judgment

Your next option is to settle the judgment. Settling means you’ll pay less than the total you owe, but still pay a good chunk of the debt. Unless you’re able to pay a significant lump sum, settling isn’t likely the best option for you.

Another downside to settling a judgment against you is it does nothing to help your credit. The settlement is noted on your credit and everyone who views your credit report knows you paid less than what you owed for the debt. Judgments remain on your credit report for a decade, so you’ll struggle to make any major improvements for at least that length of time.

Finally, it’s important to realize that any amount forgiven in a settlement is viewed by the IRS as taxable income. Far too many people are relieved to settle a debt, only to learn they owe a whole new debt to the IRS now.

For a more detailed look at how settling a debt affects your tax situation, check out


Your final option for dealing with a judgment is to file for bankruptcy. Despite what you might think about bankruptcy, it provides a number of benefits and for many, is a far better option than vacating or settling.

For starters, bankruptcy costs less than settling, most of the time. It also allows you to make a fresh start and can help to alleviate debts above and beyond the one related to the judgment.

Of course, bankruptcy isn’t perfect. It, too, remains on your credit report for 10 years. And if the judgment was filed against you several years ago, it will fall off your credit before your bankruptcy.

Regardless which of these options you choose, if you even choose one of these, you need to make sure you have a complete understanding of your situation and your options. Before you know what you’re committing to before moving forward and be sure to get any settlement offers or anything else in writing.

For more information or to discuss what you can do to alleviate the burden of a judgment – or avoid one altogether – contact R. Flay Cabiness, II, P.C. at (912) 554-3774 (Brunswick, GA); (912) 375-5620 (Hazlehurst, GA) or; (912)-554-3756 (Jesup, GA).

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Brunswick, Georgia
2225 Gloucester St.
Brunswick, GA 31520
Tel: (912) 554-3774 | Fax: (912) 262-0285

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Hazlehurst, Georgia
20 Hinson St.
Hazlehurst, GA 31539
Tel: (912) 375-5620 | Fax: (912) 375-2681

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Jesup, Georgia
198 S. Macon St.
Jesup, GA 31545
Tel: (912) 554-3756 | 888.280.1437

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