Public record judgments no longer routinely appear on credit reports.
However:
- The underlying account may still report.
- The collection account may remain.
- Credit reporting updates may depend on settlement terms.
Settlement agreements should address reporting explicitly.
Strategic Takeaway
If you are settling after judgment:
- Ask whether vacatur is possible.
- Get dismissal language in writing.
- Require filing of Satisfaction of Judgment.
- Confirm deadlines for filing.
Do not assume payment alone removes a judgment.
How to Vacate a Default Judgment in a Debt Lawsuit
If a debt collector obtained a default judgment because you didn’t respond, you may still have options.
A default judgment is not always permanent.
Here’s how vacating works.
What Is a Default Judgment?
A default judgment happens when:
- You were served.
- You failed to file an Answer.
- The plaintiff requested judgment.
- The court granted it.
Once entered, the creditor may:
- Garnish wages.
- Levy bank accounts.
- Place liens on property.
But in some cases, you can ask the court to set it aside.
Grounds to Vacate a Default Judgment
Courts may vacate a judgment for reasons such as:
1️⃣ Improper Service
If you were never properly served, the judgment may be void.
Examples:
- Served at wrong address.
- Served by publication improperly.
- Served on wrong person.
2️⃣ Excusable Neglect
If you missed the deadline due to:
- Medical emergency.
- Military service.
- Clerical mistake.
- Serious hardship.
Courts sometimes grant relief.
3️⃣ Meritorious Defense
Most courts require you to show:
- You have a real defense.
- Not just that you missed court.
Common defenses include:
- Statute of limitations.
- Lack of standing.
- Identity theft.
- Payment.
- Improper chain of assignment.
Timing Matters
Many states have strict deadlines to file a motion to vacate.
Some allow:
- 30 days.
- 90 days.
- One year.
- Or longer if service was improper.
The sooner you act, the better.
What Happens If the Judgment Is Vacated?
If granted:
- The judgment is set aside.
- The case reopens.
- You can file an Answer.
- The plaintiff must prove the case.
It does not automatically dismiss the lawsuit — it resets it.
What to Include in a Motion to Vacate
A motion typically includes:
- Case caption.
- Explanation of why default occurred.
- Legal grounds for relief.
- Statement of meritorious defense.
- Supporting affidavit.
Strong documentation improves your chances.
Strategic Considerations
Vacating a judgment:
- Stops enforcement (sometimes temporarily).
- Creates negotiation leverage.
- Restores your ability to defend.
But courts require proper legal grounds — not just regret.
Bottom Line
A default judgment is serious — but not always final.
If you were improperly served or have a valid defense, you may be able to:
- File a motion to vacate.
- Reopen the case.
- Challenge the debt buyer’s proof.
Act quickly. Delay reduces options.
