Judgments in Minnesota
What You Need to Know and What You Can Do
A judgment is a court order stating that you a debt as a matter of law. In Minnesota, it usually happens in one of two ways. Either you didn’t respond to a summons and complaint within the required time and the court entered a default judgment, or the case proceeded through the litigation process and the court ruled in the creditor’s favor.
In Minnesota, a civil judgment generally lasts for ten years. It can be renewed for additional ten-year periods. During that time, statutory interest accrues. What started as a manageable balance can grow into a much larger obligation.
If you have discovered that a judgment has been entered against you, quick action, rather than burying your head in the sand, typically results in better outcomes.
Why Judgments Matter
A judgment gives a creditor access to powerful, involuntary collection tools.
With a valid judgment, a creditor may take money from your paycheck, freeze your bank account, and place a lien on your real estate. Judgments also become part of the public record, which might affect your ability to get credit, housing, or employment.
In our experience, many people don’t address the judgment until garnishment begins. By that point, the leverage has shifted to the creditor. Acting earlier to address the debt usually provides more, and better, options.
Most Judgments in Minnesota are Entered by Default
Most judgments in consumer debt cases are entered by default. This means the defendant did not serve an Answer within the required time, which, in Minnesota, is typically 21 days after service of the Summons and Complaint. One study by a local law school suggests that well over 90% of Minnesota collection cases end in default judgments.
That is why responding to collection lawsuits on time is so critical.
Can a Judgment Be Challenged?
Occasionally.
Depending on the circumstances, it may be possible to vacate or undo a judgment. This typically requires showing a valid legal defense and a reasonable explanation for why you did not respond to the lawsuit on time. Improper service can also be grounds for relief.
Not every situation will support a valid request to vacate the judgment. In fact, in many cases, a person would be better served by focusing on resolving the judgment rather than undoing it.
Managing or Resolving a Judgment
If a judgment cannot be vacated, there are still ways to reduce its impact.
You may be able to limit garnishment through statutory exemptions or negotiate a settlement that resolves the judgment for less than the full balance. The strategy depends on your income, assets, and overall financial situation.
In some cases, particularly where multiple judgments or significant unsecured debt exists, bankruptcy may be the more efficient solution. Bankruptcy can stop garnishment and wipes out most judgment debts.
The key is not reacting piecemeal to each collection action, but stepping back and assessing the entire picture.
Related Topics
Garnishment in Minnesota – How wage and bank garnishments work, and what you can do to stop or reduce them.
Vacating a Judgment – When and how you may be able to undo a judgment.
In Minnesota and ready to talk to a lawyer about a judgment?
Schedule a consult with debt defense lawyer Todd Murray.
Since 2009, Todd has helped hundreds of Minnesotans get out of debt. His work has saved his clients millions of dollars (and many sleepless nights) in the process. Todd’s clients have described him as “very professional and easy to work with.” He lives in Minneapolis with his wife and four children.