Being sued can be a nerve-wracking experience and losing the case can have serious consequences. From paying fines to being ordered to pay damages, find out what happens when you get sued and lose with this comprehensive guide.
After You Get Sued and Lose, Understand the Judgment and Its Consequences.
After a court determines that you are liable for damages resulting from the lawsuit, a judgment will be issued. This is an enforceable decision that indicates what must be done to satisfy the judgment. Depending on the case, this could mean paying fines or compensation to the plaintiff. A lien may also be placed against your property or assets if necessary. It’s important to understand the implications of the judgment and how it will affect you in order to keep any potential damage under control.
How the Judgment Creditor Can Collect Against Your Assets After You Get Sued and Lose.
After you get sued and lose, you are the one responsible for paying damages. However, it will likely be the responsibility of your judgment creditor to collect on the judgment. This could mean they place a lien against assets you have such as a house, car, or bank accounts. The lien will remain until the balance owed is paid in full. Court orders may also be issued to seize property and assets in order for them to satisfy the debt. In some cases, bankruptcy may exempt certain assets from being sold to pay off a judgment. (See the section below about bankruptcy.)
After You Get Sued and Lose, Try to Negotiate with the Creditor/Plaintiff.
If you receive a judgment against you, try to negotiate with the creditor/plaintiff. Contact them and see if they are willing to accept a lesser amount or set up a payment plan that would be more manageable for you. It is important to keep in mind that negotiating won’t work in every situation but it is worth exploring.
If You Get Sued and Lose, Find Out If You Qualify for Bankruptcy.
While negotiating can help, bankruptcy is the ultimate solution for a lot of people who have been sued and lost. Bankruptcy will forgive a certain portion or all of your debt but it isn’t an easy process to undertake. You should discuss filing for bankruptcy with a qualified legal professional in order to gain a full understanding of the process and its pros and cons.
Will Your Spouse Be Liable for the Judgment in a Community Property State?
In a community property state, such as California or Arizona, spouses are jointly responsible for debts of the other spouse. This means if you are sued and lose in either a criminal or civil suit, your spouse’s wages may be garnished to pay your portion of the judgment. Your judgment creditors have the right to levy any bank accounts with the funds held jointly with your spouse. Debt collectors can go after any property owned jointly by both spouses as well.
You May Have Other Options.
Don’t rely on this short blog post to decide your future. There are other possible ways of mitigating the situation. Give us a call at 602-443-4888 and let’s see what your options are.
