If a creditor wins a judgment against you, the judgment can be used to garnish your wages or levy your bank account. Depending on the circumstances, you may be able to stop this by vacating or reversing the judgment.
Vacating a Judgment
The Skiba Law Group writes on its website that many debtors make the same mistake when a creditor sues them for debt — they don't respond to the lawsuit or show up in court. When that happens, the creditor usually wins by default.
If you lose by default, you can file a motion to vacate, a request for the judge to set the order aside. This doesn't eliminate the debt or put an end to the lawsuit. It does, however, give you a second hearing in which you can contest the creditor's claims.
The exact procedure for filing depends on your state's rules for civil cases, which should be available on the state court website. Once you know what to do, act promptly, before any deadlines on filing can expire.
The Nolo legal website reports the best way to win is to prove you were improperly notified of the lawsuit. When you're sued, you have to receive a summons to court and a copy of the creditor's complaint. If you never received the papers, you have grounds to vacate the judgment. You can also request a motion to vacate if the server didn't follow state law. In New York state, for example, the creditor breaks the rules if he hands you the papers himself.
If you were properly served, you must convince the judge that there was no way for you to make the hearing — you were incarcerated, say, violently ill, or attending your father's funeral. It's up to the judge's discretion whether your explanation is good enough.
You also need a meritorious defense, an argument that if you made the hearing, you might have won your case. The judge has no reason to vacate if you'd have lost even if you did show up.
Filing the Motion
You file the motion with the court that issued the default judgment. The court clerk should be able to provide you with information about the proper procedure. The forms to file may be available on the court website, or from a local attorney. If you need legal help and don't have money, the American Bar Association has a state-by-state guide to finding legal assistance.
Reversing the Judgment
You reverse a judgment by kicking it upstairs to the appeals court for your district. This is an option if you attended the hearing but still lost. It's a more complicated process than filing to vacate, and it's more likely you'll need an attorney's help. For instance, the Clark County court system in Nevada lists the steps to appeal a Clark judge's rulings:
- File a notice of appeal with the clerk of the court that issued the judgment. Include all required fees.
- Serve a notice of appeal on the creditor.
- Ask the court to stay enforcement of the judgment until the appellate court hears the case. You may have to post a bond.
- Order a transcript of the case.
- File a legal brief with the appellate court.
- Make your case to the appellate judge.