TX: Is an Agreed Judgment necessary/advisable? I did not consent.

[marianneliberte]

Question: Is an Agreed Judgment necessary in this situation?

I want to pay the full balance on a credit card debt. I received a notice of intent to file civil law suit from a collections attorney representing the Original and Current Creditor (same bank). I contacted them and over the phone discussed terms (a payment plan) and requested the paperwork for a settlement agreement of those terms. I received in the mail a 1) settlement agreement, and 2) an agreed judgment. They have asked me to sign both and return them. In the settlement agreement it says:

"During the conversation, you expressed a desire to reach a settlement in this matter and stated that you would be willing to enter into a payment plan concerning the Account on the condition that (1) we enter into a signed settlement agreement, (2) you agree to a repayment plan, and (3) you consent to the entry of an Agreed Judgment. In exchange, we will agree not to pursue collection of the judgment as long as you make you agreed payments under the terms of this Settlement Agreement:" [and then it lists the repayment terms]

At no point in the (legally recorded) conversations was an Agreed Judgment discussed.

The Agreed Judgment includes an additional page, that states: "It is further ordered, adjudged, and decreed that the plaintiff Bank of America, N.A., is entitled to post-judgment interest on said judgment to be computed at the rate of 5.00% annum on the damage portion of the award, and at the rate of 5.% per annum as to all over amounts awarded herein, said interest to accrue as allowed by law from the date of this judgment until this judgment is satisfied."

In the phone discussion, the representative specifically stated that they are not charging interest.

I was informed when I originally called them that the law suit had been "printed", and that the next step would my being served. The validation documents and the above described documents were mailed to me.

I want to sign a settlement agreement. I want and am prepared to repay this debt. I do not want to agree to a judgment against myself.

[Clydesmom]

46 minutes ago, marianneliberte said:

I want to sign a settlement agreement. I want and am prepared to repay this debt. I do not want to agree to a judgment against myself.

Typical response of a creditor.  They want that consent judgment so that if you default again they don't have to sue you they only have to file it with the courts and collect via garnishment or bank levy.  USUALLY that judgment NEVER gets filed unless you stop paying again.  Once you fulfill the settlement agreement it is null and void.

You can ask the to remove that consent judgment but my guess is they say no and simply file the suit.  

[marianneliberte]

That's what I'm figuring. Sigh. As for it being null and void or them not filing it; given the additional page that grants them a post-judgment of interest, I suspect they would file it in order to get that extra ~$750 of interest.

[BV80]

59 minutes ago, marianneliberte said:

The Agreed Judgment includes an additional page, that states: "It is further ordered, adjudged, and decreed that the plaintiff Bank of America, N.A., is entitled to post-judgment interest on said judgment to be computed at the rate of 5.00% annum on the damage portion of the award, and at the rate of 5.% per annum as to all over amounts awarded herein, said interest to accrue as allowed by law from the date of this judgment until this judgment is satisfied."

If there's been no law suit and court ruling, I don't see how they can claim that it is "adjudged" and require "post-judgment" interest.  I'd call some attorneys just to see if one would talk to me over the phone and ask about it.

[BV80]

1 hour ago, marianneliberte said:

I contacted them and over the phone discussed terms (a payment plan) and requested the paperwork for a settlement agreement of those terms. I received in the mail a 1) settlement agreement, and 2) an agreed judgment. They have asked me to sign both and return them. In the settlement agreement it says:

Was it the attorney you contacted?

[marianneliberte]

2 minutes ago, BV80 said:

Was it the attorney you contacted?

Yes, in a way. I spoke with the non-attorney who is the only type of representative working for the attorney with whom one can speak. I called the number provided by both the OC and the letter from the attorney, and the staff member to whom I was directed is not an attorney but works for them. Same office.

[BV80]

19 minutes ago, marianneliberte said:

Yes, in a way. I spoke with the non-attorney who is the only type of representative working for the attorney with whom one can speak. I called the number provided by both the OC and the letter from the attorney, and the staff member to whom I was directed is not an attorney but works for them. Same office.

What I'm wondering is if the "agreed judgment" is legal.   I'm not an attorney, but if it's the same as a stipulated judgment, I've never seen it offered unless a lawsuit has been filed and is pending.   In your case, no lawsuit has been filed.

As I stated before, I'd ask an attorney about the legality of the agreed judgment when there is no lawsuit.

[marianneliberte]

This situation worked out, thankfully. I contacted the collections agency for the OC and asked whether a law suit had been filed. No suit has been filed. The Agreed Judgment was sent in error, and a new settlement agreement is being sent out.

phew. Thanks, all!