DEFINITION of ‘Stipulated Judgement’
A court order that requires one party to pay another party a specified amount of money. A stipulated judgement might require a consumer who has stopped paying his credit card bill to repay the credit card company a certain sum on a certain date each month until the debt is paid off.
INVESTOPEDIA EXPLAINS’Stipulated judgement’
Because stipulated judgements involve delinquent debtors who often aren’t able to fully repay what they’ve borrowed plus the interest and fees they’ve accrued, the stipulated judgement might reduce the debtor’s repayment obligation in some way so the creditor can at least recoup part of what the consumer owes. The debtor must fully comply with the stipulated judgement to receive this benefit.
If you are responsible for a stipulated judgement, you must adhere to its terms or the creditor can sue you for the full amount you owed before the stipulated judgement, minus what you’ve paid since then. In other words, any reduction in payment the creditor might have granted you will be off the table. If you’re having trouble making your payments under a stipulated judgement, get in touch with your creditor and see if they will work with you.
Getting sued for delinquent debt will show up in the public record section of your credit report. It will further damage your credit score beyond the damage you’ve already done by defaulting on your payments. The court could order your employer to garnish your wages to repay your creditor, and it could order your bank to turn your savings over to your creditor. You could also be forced to sell some of your assets to pay the judgement. The outcomes of losing a lawsuit brought by a creditor are much worse than the strain of repaying your stipulated judgement, and your financial obligation will increase because of court fees and possibly attorney fees.