If you have debts, it is natural that the creditor would try to collect. In order to collect, the creditor would use all means necessary including filing a case against you. You will be given 30 days to dispute the claim made against you. If you really owe the money, you should immediately try to contact your creditor in order to make a new payment arrangement that would be amicable to both of you. You will pay off your debts as longs as they agree not to press charges. You should do this in order to avoid a judgment record on your credit history.
Whenever a debt remains uncollected, your creditor could take you to court. If you were found liable, then a judgment will be issued in favor of your creditor. You will be given another 30 days to file an appeal although it would be a waste of time, if the debt is really your responsibility.
Judgments like collection accounts, charge-offs and bankruptcies can lower your credit score significantly. A ruined credit report will mean difficulties in proving your financial credibility. Even as something as simple as credit card application can be rejected if you are not careful on how you handle all your credit. Removing judgments can actually be done in three ways.
Check Out the SOL
You should determine the SOL or statute of limitations for judgments in your state. On the average, these judgments usually stay on your credit report for seven years but its statute of limitations can last for longer. This is also the length of time that your creditors will have to try and collect the debt you owe them. If the SOL has expired, the judgment should be removed from your credit report if there were no renewals filed by the creditor. Any dispute should be reported immediately so that your credit history is updated and corrected.
Another way you can remove the judgment from your credit report is by negotiating with your creditors. In exchange for the payment of the debt, your creditor will have to request the dismissal of the judgment. The judgment entry will be removed from your credit report completely. Normally, when debts are paid after a judgment has been issued, a rating of “paid judgment” is entered. But if you negotiate removal then it would work wonders for your credit score. Of course, you have to document such agreement so that you will have something to show the credit bureau in case your rating did not change.
Lastly, you can remove a judgment by filing for a motion to vacate. In most cases, this motion is filed if the creditor sued you wrongly. If the court vacates the judgment then it will be removed from your credit report and you are not even obligated to pay your debts.
Learning about judgments is very important if you want to have a fighting chance of removing it from your credit report and protecting your credit score.