Why Default Provisions in Settlement Agreements Matter for Creditors

In debt collection, speed matters. To ensure quick success in obtaining a debt collection judgment, all settlement agreements should have a default provision.

A judgment clerk can enter judgment on default, without obtaining a court order, when the creditor has set forth and supported with documentary evidence a claim for a liquidated amount. The claim for the liquidated amount or sum certain should be in the initial pleadings filed with the court. You can submit the documentation to the court when submitting the judgment.

But, what happens after you settle a claim and all parties sign an “agreement” that provides for, among other things, the payment of monies? These agreements should contemplate “what if” the monies are not paid.