Legal Question in Credit and Debt Law in North Carolina

I am not sure I understand the question.

A judgment is a piece of paper that says you owe money to someone, in this case a car lender.

If a vehicle is repo'd, that means that the car is sold at an auto auction, usually for far less than whatever is still owed on the vehicle. Once the car repo and sale costs are added and the price at auction is deducted, then any balance still owed is still your responsibility. If you don't pay or otherwise resolve it, then the car lender, or anyone they sold the car loan to like a junk debt buyer, can and will sue you.

I don't know the circumstances from your post so I don't know what stage of the proceedings you are at. Were you served with a summons and complaint or were you previously served and you recently received notice of the judgment? The latter is not typical.

What usually happens is that you have 30 days after you receive the summons and complaint to file an answer. An answer should only be filed if: (1) you don't owe the debt, like in the case of id theft or if you already paid it off; (2) you don't owe as much as they claim; (3) the statute of limitations bars collection of the debt (its 3 years for most things in NC, but there are exceptions which might change my advice); and (4) you have other claims or defenses. If none of these apply, you can file an answer, but you are only delaying the inevitable as the car lender or their assignee will get a judgment against you.

Once the judgment is entered, 30 days must pass. After that, the creditor can try to collect. They collect by a process called execution. You will receive from the sheriff a motion to claim exempt property and a notice of rights. Those papers are important so do not ignore them. Fill them out. If you don't fill them out, then if you happen to own property (another car or a piece of land) that is owned free and clear, it can be seized and sold. Your bank account can be frozen.

The good news (to the extent there is any) is that a judgment can be resolved. If you can afford it, pay the whole sum, either at one time or make payments directly to the clerk of court. It behooves you to pay as the judgment earns interest at a rate of 8% per year so its only going to get bigger. If you can't afford to pay, keep saving until you have at least 50% of whatever the judgment has grown to and offer that to the creditor. If you have 50% of whatever the creditor wants now, then try to resolve the debt now.

Before you pay a dime, you need to get a letter from the creditor outlining the terms of any agreement.

If you would like further advice about your situation, I give free consults via email. I also assist clients with exemption forms, asset protection or resolution of their debts for a reasonable fee.

If interested, please contact me at [email protected].