If you signed off on a settlement agreement, despite whatever appellate and collaterally offensive remedies you have available, it will be an uphill battle with quite a bit more attorneys expenses.
If you did not sign off on a settlement or authorize a settlement you may have a cause of action against whoever agreed to settle the case in your name without your authorization.
What state did this occur in? You need to talk to an attorney in the state where the judgment was rendered about the appellate options. In Texas there is something called a Bill of Review that can be used when a default judgment is taken. It is hard to tell on these facts whether that would be applicable even if your case was in Texas.
This sounds like a small claims case, meaning the cost of hiring an attorney to try and unscrew this mess after the fact may not be worth it from a cost benefit standpoint. If you are eligible for bankruptcy, go ahead and file, but it seems unlikely that this judgment alone will be sufficient to make you eligible if you have garnishable income. Making them collect you through wage garnishment is going to just cost you more money. You may just need to pay them, and if you are ever sued again, consult a lawyer on the front end immediately.
This answer is provided for general information only. No legal advice can be given without a consult as to the specifics of the case.