What is a "default judgment" and how do I avoid it?

A Default Judgment is a binding court order entered against you because you failed to respond to a lawsuit. If a loan app sues you and you ignore the court summons (do not show up or file an answer), the judge automatically rules in favor of the lender .

Consequences of a Default Judgment:

• The lender can legally garnish your wages (take money from your paycheck).
• They can levy your bank account (take money directly from your account).
• It severely damages your credit for 7-10 years.

How to Avoid It (Crucial Steps):

1. Do NOT ignore the summons. Read it immediately.
2. Respond by the deadline. File a written response with the court (an "Answer") denying the claim or stating your defense.
3. Show up to court. Even if you owe the money, showing up prevents an automatic "default." You can negotiate a payment plan with the lender's lawyer in the hallway before the hearing .

Pro Tip: Even if you settle the debt after being sued, get a "Stipulation of Dismissal" filed with the court. If you just pay the app directly, they might keep the case open and get a default judgment against you anyway for "court costs."