A number of different sites and many (unfortunately) experienced contributors provide a rather solid view of getting to the point of a default judgment, what you can do at the hearing on a default judgment, what typically happens after a default judgment occurs, what you can still do after a default judgment occurs against you, and what you really cannot do after a default judgment.
First point needed to be made. Everyone advises to never admit over the phone or in writing that you are responsible for the amount owed. Simply state that you are NOT responsible for the amount owed, but that you would like to discuss a payment plan to resolve the current credit issue.
Many of the experiences read during research had one very common, repeated theme – do whatever you can to not get to the point of a default judgment. What this means is “communicate” and “document”. Communicate with the credit card company. Document every phone call and mail / email you have with the creditor. Send them some money every month, even if it is not the minimum amount on the statement. It is hard for a creditor to show bad faith and claim default when you are communicating and sending some money to them. Make sure that you get and write down the first and last name of anyone you talk to. Write down the date, time, and where you were when called. Even if the credit card company threatens you with a collection agency, keep sending them a monthly payment. If the credit card company does turn your account over to a collection agency, continue to send the agency a monthly amount, and continue to document who, when (date and time), where you are when called. If the relationship seems to be bad, it is likely time for at least a legal consultation. Some attorneys will advise you for a small amount ongoing.
If a summons arrives for a default hearing, YOU MUST ATTEND!!! If the hearing happens, be there – no excuses, be there. Why? You want to present to the judge your documentation at trying to arrive at some negotiated payment that you could afford, anything that seems like harassment, and you want to be able to demand proof from the collection agency the amount that you owe. The point one site makes that if the agency cannot provide this, and often times the creditor does not send the agency sufficient documentation, the entire situation might be dismissed and the amount owed wiped away.
If you do not attend the hearing and a judgment is made against you, you can still ask for an opportunity to have the judgment dismissed based on your documentation. It is easier if you attend the original hearing, but, it never hurts to ask afterwards.
If you get no relief, your attorney-consultant or online research for your state will tell you what a creditor can garnish and seize to pay off the debt. Federal returns and social security cannot be touched. You have to confirm what happens if they are automatically deposited in your account, but most states protect those assets. You can always continue to negotiate the creditor to resolve the issue, but most creditors want their money and want it now.