How long do judgments stay on a credit report?

Uncategorized May 29, 2013 Comments Off on How long do judgments stay on a credit report?

Many creditors take their defaulting clients to court as a means of collecting a debt. A judgment is a debt imposed by a court of law. When a lawsuit is decided in favor of the plaintiff (the creditor) it results in a judgment against the defendant ( the person being sued ) and in favor of the plaintiff for the amount granted by the court. These are by far the most powerful means of enforcing the collection of a debt owed.

Unlike most credit reported items, most states do not have a 7 year statute of limitations for judgments. For example, A judgment in California is valid for 10 years and can be renewed for another 10! They accrue interest and penalties the entire period and can be multiple times the original debt.

Only a bankruptcy will stop a judgment from being enforced. Of course, enforcement can be a challenge for a creditor. However, the law is on the creditors side. If the defendant has a wage earning job, or owns any real estate, or has a bank account or investments he/she is subject to garnishment of wages, levying of assets or liens on real property. In this day of advanced technology it is fairly simple for a creditor to find what he needs to enforce the judgment.

Once he has found assets, bank accounts, property etc he can take the judgment to the local Marshall who will enforce it. There is nothing the defendant can do to stop it or reverse it at that point.

Obviously, it is imperative that people do whatever they can to avoid judgments by making successful arrangements with the creditor prior to it being taken to court. You will save yourself a lot of grief in the long run.

Of course, as with any debt, credit repair does not relieve you of the responsibility of the debt, even if the debt is removed from your credit report.

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