A default judgment is awarded to a party filing a lawsuit against you, after you fail to appear in court to defend yourself. Settling the lawsuit may not be easy. The judgment allows the other party to garnish your bank account or wages. That means a settlement negotiation could be difficult, because you have little leverage. "The New York Times" reports that default judgments are common in credit card lawsuits.
Contact the attorney for the party filing suit. You should have received a legal notice from the court informing you about the default judgment. Find the attorney's contact information on that notice.
Call the attorney. Offer to pay the account in full -- either in a lump sum or in installments. Usually the goal in a settlement is to pay less money than you owe. However, under this scenario you should be most concerned with avoiding the embarrassment of wage or bank garnishment. Try a two-pronged negotiation: offer to pay, say, 60 percent of the balance in a lump sum or 100 percent in installments. The attorney may elect to take a lump sum offer to get money up front.
Ask the attorney to send you the details in writing. Do not make a payment until you receive the agreement. Send the payment or installment payments by cashier's check, to safeguard your banking information.