Thank you for all the information. Based on the facts you have presented, it appears that the creditor has already obtained a judgment. How?
Based on what you have told me, it is highly possible that the creditor filed a lawsuit in New Jersey, claimed to the court that they could not find your grandmother and then had her served via newspaper publication. Believe me, it is easier to do than it sounds.
Generally, to serve someone with a lawsuit via newspaper publication, an attorney signs an affidavit stating that he/she cannot find the person. Even if they have not looked, if they know the judge and he/she trusts them, it is usually rubber stamped.
Once the order for publication is entered, the creditor can publish a notice in some -- possibly small town newspaper that is approved by the court -- which will ensure that most people will not read it.
After about 4 weeks of publication and no one answers the lawsuit, then the creditor can file for a default. This is a legal term for basically a forfeit. After that, the creditor can file for a default judgment. However, the motion to obtain a default judgment usually must be sent to a real address and not through a newspaper.
Now, since it appears that a judgment has been entered, it would be advisable to have someone physically go to the New Jersey Court and copy the court file. I realize that this is not convenient, but it is the only way to find out what happened in the case.
Subsequently, it would be wise to file a motion to set aside/vacate the default judgment or any judgment based on lack of due process. Meaning that your grandmother never received any of the court papers. Since most states have laws that favor the elderly and/or there is usually this sentiment, you should include her age in the motion.
If she cannot afford an attorney, then you should look at the local clerk of court's website and find out if they have any forms for these types of motions. Even if you cannot hire an attorney, it would be advisable to have a consultation with one to get some more detailed information. Usually, if you find an attorney that has been in practice for 1-5 years, the fees are less expensive.
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