Judgement from Asset Acceptance

I hope someone can help me with this matter I'll will try to make a long story short back in 95/96 my now husband then boyfriend had a car repo of course the bank sold the account to Asset Acceptance who then slaps a judgement in 2000 without notifying him and charges interest on the judgement to where the balance is more then what the car was originally bought for. Last week in the mail we get a writ of garnishment letter this was last Thursday and with the writ of garnishment there was a court date set for 5/25/07 in the previous county we use to live in then the following day on Friday I check our bank account balance online ( we have a joint checking ) and there is 0 balance they in turn sent the garnishment to the bank who then withdrew all our money out of our account this being 2 weeks before court date now my husband gets an attorney they said they would settle for but it's only 40% of the said amount a total of 7,800 is what they want and want an answer by the end of this month per the attorney my husband is dealing with I'm so stressed with this my husband granted never handled this well and did have the car repo on his own judgement but to go in and take every penny we have the day after receiving this notice now there wanting this obsurd amount up front is making my husband think BK which I dont want because his credit is so good even with this judgement his beacon and credit have always been in good standing. I have read some old posts on here about this company and how many rules they have broken and how fraudlent they are and how hard they are to deal with. Granted I know other people who have had there cars repoed as soon as 2003 and nothing has been this aggresive as this is from 1996 11 years later. Any suggestions on how to fight them not get out of the debt but somehow negotiate lower etc. or is BK the answer???