Judgments can have a huge, lasting impact on your credit score, giving you major difficulty in obtaining credit cards or loans.
Perhaps you received a civil judgment from a lawsuit concerning old debt or even a former eviction. Whatever the reason, they cause long-lasting damage, even years after the incident occurred.
Luckily, it is possible to have them removed before the usual end date. Find out everything you need to know about judgments, how they affect your credit score, and how you can get them removed even before they expire.
What is a judgment?
A civil judgment refers to a ruling made by a court during a lawsuit. Often, people have civil judgments because of unpaid collections or other financial obligations. A judgment on your credit report shows up as a public record placed there by the credit bureaus.
Anyone can see public records, and the three major credit bureaus collect them to show future lenders your credit history. It’s basically a decision by the court describing the result of the lawsuit.
How does a judgment affect your credit score?
A judgment is one of the most damaging things to have on your credit report. Unlike collections, which involve a dispute between two private parties and are almost always handled privately, a judgment occurs when a court-ordered mandate is to repay a debt.
This can occur in situations such as failure to pay child support, alimony, or civil and small claims lawsuits.
If you have a judgment on your credit reports, it will lower your credit score. Potential creditors will be hesitant to loan you money because they can’t trust that you’ll repay the debt. Even if you’re able to get a new credit card or loan, you can expect some of the highest interest rates on the market.
How long does a judgment stay on your credit report?
A judgment remains on your credit report for seven years from the date it was filed. That means it will negatively affect your credit scores for up to seven years. However, the negative impact weighs less and less, as time goes on.
If you’re still unhappy about having to wait that long, it is possible to have judgments removed from your credit report.
If you can get the judgment removed, you won’t have to wait up to seven years before being able to get a mortgage, car loan, or any other type of credit again. Keep reading to see how you can get a judgment deleted from your consumer credit reports.
Different Types of Judgments
While all civil judgments are listed in the Public Records section of your credit report, there are a few different types of judgments to be aware of.
Each one results from how you handle the initial judgment and can impact your credit score differently. So read through each description carefully, so you know which situation could apply to you.
Unsatisfied judgments do the most damage to your credit history. It means that you have not addressed the result of the lawsuit whatsoever and the debt you owe has neither been paid nor settled.
The judgment creditor (who sued you to get the funds) has the right to forcibly collect the money if you refuse to pay or work out a settlement in a timely manner.
Otherwise, the unsatisfied judgment will stay on your credit report for the full seven years. You might receive notice from the creditor at some point, or it may go untouched until it drops off; there’s just no way to know. In some states, you may run the risk of having an unsatisfied judgment re-filed, which we’ll discuss shortly.
A satisfied judgment is one that has either been paid or settled rather than remaining unsatisfied. It’s ideal to get your judgment satisfied as soon as possible because it’s another type of debt that accrues interest. As a result, the amount you owe can quickly multiply.
So how can you satisfy a judgment? There are a few different ways. First, you can pay the judgment in full. However, if that’s not possible, you can also negotiate a settlement, similar to any other way you would for any other type of debt.
In extreme circumstances, you can get the judgment discharged by filing for bankruptcy. Finally, you can do nothing and eventually have the judgment collected forcefully, usually involving wage garnishment.
Once one of these options has been completed, your judgment will switch from unsatisfied to satisfied on your public record and credit report.
A satisfied judgment is better for your credit history than an unsatisfied one. However, it still stays on your credit report for seven years from the date it was filed. Many people think that once it’s paid, the credit bureaus will remove the judgment from their credit report; however, that is not the case.
A vacated judgment is essentially one that is dismissed through an appeal. Vacated judgments should no longer appear on your credit reports. If it does, you can have it disputed as incorrect reporting from the credit reporting agencies.
There are several ways to get your judgment vacated. The first way is to file a motion appealing the original ruling. It’s quite common to successfully appeal the verdict if the plaintiff didn’t follow the proper legal procedure in the original lawsuit.
Procedural reasons might include not receiving a summons to court or receiving a default judgment without a hearing.
Most motions for appeal must be completed in person. So, if you no longer live in the jurisdiction where the lawsuit took place, you’ll need to travel there to submit your paperwork and potentially attend another hearing.
If you win the appeal, you’re entitled to a court document stating the dismissal of your case. Then, you can send a copy to the credit reporting agencies to expedite the removal process of the vacated judgment from your credit reports.
If it’s not removed, you should file a dispute with the credit bureaus, either on your own or through a credit repair company. Of course, a vacated judgment should never be listed on your credit report, but it’s up to you to ensure that all the information is updated accurately.
Judgments are typically removed after seven years, but unfortunately, that’s not always the end of the story. Depending on the state in which you live, the judgment may be renewed, which means it can reappear on your credit report for another seven years.
In some states, judgments can be renewed indefinitely, meaning they’ll keep showing up for years and years beyond the original filing date.
Take a look at the laws in the state where you live to determine whether your judgment can be revived. From there, you can figure out the best course of action to satisfy your judgment and have it removed for good.
What should I do next time if a debt collector sues me?
If you get sued, you will need to pay the debt quickly or appear before a judge in court. The worst thing you can do is ignore the lawsuit. However, that’s precisely what most people do, so usually, the creditor wins by default as the defendant doesn’t show up for court.
If you don’t show up or lose your case in court, a default judgment will be issued against you. Typically, you will be penalized by having a tax lien placed upon your house (if you own your house) or having your wages garnished.
In some cases, you may even be forced to forfeit your belongings. These side effects are even more severe than the damage done to your credit score, so you really need to address the lawsuit, get legal help, and show up in court. Otherwise, you have a long, hard road to financial recovery ahead of you.
It never hurts to talk to a legal professional ahead of time to explore your options. But, at the very least, you need to attend your hearing, so you don’t automatically give up your rights to a fair trial.
How to Remove a Judgment from Your Credit Report
Ready to get a judgment removed from your credit report before seven years? Here are three steps you can start today.
Step 1: Get the Court to Validate the Judgment
Start by contacting the court directly. This means you need to actually write a validation request letter to the court that issued the civil judgment. The purpose is to have them verify that the judgment — and all the relevant details listed on your credit report — are accurate.
If the court can’t do this or simply doesn’t bother, as is often the case, you can request to have the listing removed by the credit reporting agencies. Under the Fair Credit Reporting Act (FCRA), a credit bureau must remove any information that cannot be verified. Just be sure to keep copies of all your correspondence sent and received so you can back up your case.
Step 2: Confirm Any Information from the Court
If you do receive information back from the court verifying the details of your civil judgment, take the time to make sure that it’s all accurate.
All of this information goes through so many different touchpoints that there’s a good chance some of it was reported inaccurately.
Everything must be error-free. That includes your name, balance, account numbers, dates associated with the account and judgment, and your account and payment statuses.
If you find anything that’s incorrect, you can send a dispute letter to the credit bureaus and request that the judgment entry be updated or removed altogether.
Step 3: Get Professional Help from a Credit Repair Company
If disputing a judgment seems like a long and tedious process, you’re unfortunately right. That’s why many people opt to hire credit repair companies to do the dirty work for them.
There are plenty of reputable companies that have high success rates in getting serious entries removed.
Get Your Judgment Removed Today!
If you’re looking for a reputable credit repair company to help you remove a judgment from your credit report and repair your credit, we highly recommend Lexington Law.
Call them at (800) 220-0084 for a free credit consultation. They have helped many people in your situation and have paralegals standing by waiting to take your call.
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