Ways to legally remove a judgment from your credit report
By financen | October 18, 2012 - 3:24 pm - Posted in Credit report, Judgment

You have a judgment showing up on your credit report. You have two choices. Pay off the debt and get a satisfaction of judgment or dispute the item with the credit bureaus.

Judgment

Judgment

A judgment is a court order for someone who has not been able to pay off his past debt and the creditor has filed a lawsuit against him. The court will not force the debtor to pay back the creditor. Instead, the creditor has to take necessary actions on their own to collect the debt from the debtor. There are several ways of doing this.

If the debtor owns a property, they can have the judgment recorded in the counties where the property is located. If the debtor is trying to sell or refinance the property, a title search will show the judgment. The judgment is a lien on the property, just like a mortgage, and it has to be paid off before the property can be sold or refinanced.

If the judgment is for a high amount of debt, and the debtor has non-exempt equity in the property, then the creditor will try to put a lien on the property and then sell it to pay off the judgment. Now, if the debtor is residing in that property, there are certain rules that must be followed. For example, in US, a creditor cannot claim a certain portion of the equity in the real estate. This means that the debtor can keep that portion in equity from the sale.

Not only just property, judgments can also be collected against bank accounts, and wages through garnishment. Finally, a creditor can elect to have the county sheriff seize non-exempt personal property from the debtor and have it sold at a Sheriff’s Sale.

Unsatisfied civil judgment will have a negative impact on your credit scores. The credit bureaus collect information about judgments by searching real estate and court records. Once you have paid off a judgment, you must ask the creditor to file a satisfaction of Judgment with both the court, and in any other counties where the judgment was recorded. This will prove that the judgment was paid, and it will not do any damage to your real-estate transactions.

Once the satisfaction of judgment forms are filed, still if the judgment shows up on your credit report, then you must dispute the item with the concerned credit bureaus. Write a dispute letter to each of the credit bureaus informing them that the judgment is been paid. You can also attach a copy of the satisfaction of judgment from the court. The credit bureaus will have 30 days to verify your information with the court, and if all the information is found to be correct, they will show it as a paid judgment on your credit report.

In some states, the social security number of a judgment debtor is not included in the court file. Because of this, the credit bureau may list the judgment on the credit reports of all debtors with the same or similar name. If you see a judgment wrongly showing up on your credit report, immediately write a dispute letter to the credit bureau and get it deleted.

Important links:

http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre34.shtm

https://ows2.gov.ns.ca/LandRegistrationResourceMaterial/Land_Registration/Bankruptcy/Discharge_of_Bankruptcy/Discharge_of_Bankruptcy_Remove_Judgment_Roll_only.htm

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Common Bankruptcy Myths and misconceptions
By financen | October 8, 2012 - 4:35 pm - Posted in Bankruptcy

bankruptcy

bankruptcy

If you are struggling with your finances and getting deeper into the hole of debt, then it is time to review all your options and take immediate steps. Many people are scared with the thought of filing for bankruptcy, but the fact is that when this option is used correctly, it can be invaluable tool in making your life a lot more stable. Browse through the internet and get all the valuable information from the reliable resources and do not hesitate to ask questions. Debunking popular myths may not be the easiest thing, but if its about your future, its important that you take the time to do so.

One of the most common myth that discourages people from filing for bankruptcy is that if they file, everyone around them will come to know about their personal decision. They will be fired from their place of work and will hurt in many other ways. This actually, is not the fact. When there are public figures and big corporations filing for bankruptcy without any publicity, it is largely unlikely that your filing will become news. When you file for bankruptcy, it is only you, your creditors, and the people whom you inform about this will know this fact, no one else.

Another myth that is commonly believed is that when people file for bankruptcy, they will lose everything that they have. So they like to stay with their debts. This is however, a falsehood and dangerous belief. If you file for bankruptcy, it does not mean that you will end up losing everything that you have. It entirely depends on the kind of bankruptcy you are filing for. Chapter 7 bankruptcy will liquidate some of your assets, in order to pay off your debts. While in chapter 13, you will be able to keep your assets intact. You will be put in a repayment plan with your creditors through the court trustee.

Another misconception is that if you file for bankruptcy, you will never get credit in the future. The fact is when you file for bankruptcy, the negative remark will stay on your credit report for some time. But this will not stop you from rebuilding or regaining new credit. It is fact that creditors will charge you high interest rates in the beginning, but as you are working on rebuilding your credit over the time, you will be able to make smart decisions.

Another myth in belief is that if one of the spouse needs to file for bankruptcy, the other spouse also has to necessarily file for the same. This is wrong. Due to so many misconceptions and myths that surrounds the process, it is highly recommended that people who are thinking of bankruptcy as an alternative should consult an experienced bankruptcy attorney who will guide you through the proceedings.

Resources:

http://www.uscourts.gov/FederalCourts/Bankruptcy.aspx

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/ManagingDebt/Bankruptcy/DG_187323

http://www.itsa.gov.au/dir228/itsaweb.nsf/docindex/bankruptcy-%3Ebankruptcy+overview

 

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