The Case Is Reopened
When the court grants your motion to vacate, the default judgment is set aside and the case returns to its pre-judgment status. You will typically have 20-30 days to file an answer to the original complaint. This is your chance to raise every defense and counterclaim. Do not miss this deadline -- you will not get another chance.
Filing Your Answer
Your answer must respond to every allegation in the complaint. For each paragraph, you admit, deny, or state that you lack sufficient information. Raise all affirmative defenses: statute of limitations, payment, accord and satisfaction, FDCPA violations, lack of standing (for debt buyers), and any others. Include counterclaims if applicable.
What the Creditor Will Do
After you answer, the creditor may: attempt to negotiate a settlement (often at a significant discount), pursue discovery, file a motion for summary judgment, or dismiss the case if their evidence is weak. Many debt collection cases settle after the default is vacated because the creditor knows they have a fight.
Judgment Lien Removal
If the default judgment created a lien on your property, vacating the judgment should remove the lien. You may need to file a separate motion or record a certified copy of the vacatur order with the county recorder. Check your county's records to confirm the lien has been removed.
Frequently Asked Questions
Can the creditor get another default judgment?
Only if you fail to respond again. Once you file your answer, the case proceeds normally. Stay on top of deadlines.
Should I try to settle after vacating?
Often yes. You are in a stronger negotiating position. Settlement offers of 30-50% are common. Get any settlement in writing with a stipulation to dismiss with prejudice.
What if the creditor re-serves me and I still can't pay?
Consider bankruptcy. The automatic stay stops all collection, and Chapter 7 can eliminate the debt entirely.
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