judgments

[tcreegan]

judgement credit report problem

Hello all,

This was a few years back, but my credit score took a massive hit when the judgement was entered. BK cleared the debt, but it took lots of letters and the patience of a saint to get it off my credit report. Credit score took a bigger hit from the judgement than the BK...go figure

Tom in Colo

[SunshineGal]

Seems like there are different experiences with judgments here, but I had heard what you said.....I'll double-check with my attorney, but if anyone else knows what the answer is, I'd love to hear it.

In your initial post you ask about buying a house. There are basically two areas of concern regarding a mortgage. From the initial loan approval stand point, your discharge papers will be part of the loan file, the credit report should say "included in BK" and the underwriter will know the judgment was discharged. So you should be okay here, but then again, I've seen some huge errors on credit reports.

The second issue involves the Title. In order to get a clear title, the judgment has to be resolved in the public records at the local courthouse. Chances are good that the Title Insurer will require that judgment to be satisfied prior to issuing the title insurance policy. Now, it may not matter so much on a purchase because the purchase money mortgage would still hold first lien since the judgment cannot attach until you own the property. I did see a refinance where the borrowers had to vacate the lien prior to the loan closing. They could prove the money owed was discharged but that didn't make a difference. The judgment creditors lien was still valid and the Title Co. demanded the lien be removed.

If it were me, I would go through the steps to have the lien vacated so that I didn't have to worry about it coming back to haunt me down the road.

Just my two cents and no, I am not a lawyer, lol.

[rebuilt]

Yeah, it seemed to me commoon advice is to avoid getting judgements if at all possible, as they really stain your record, I guess even if noted that they were dismissed or whatever.

[SunshineGal]

Many would disagree with me here, but in my opinion, if you are planning to file anyway than a judgment isn't the end of the world. A lot depends on the laws of your state. I think each case is different and in some cases, you're better off with the judgment than filing before you're ready. Yes, it will cause more paperwork and additional fees, but once you file, you can't file again for quite a while.

[billycool]

thanks, much...

This is sort of what I thought. I knew the judgment couldn't impact me from a short-term collections perspective, but thought that it might down the road in attempting to buy or finance real estate. Thanks again.

In your initial post you ask about buying a house. There are basically two areas of concern regarding a mortgage. From the initial loan approval stand point, your discharge papers will be part of the loan file, the credit report should say "included in BK" and the underwriter will know the judgment was discharged. So you should be okay here, but then again, I've seen some huge errors on credit reports.

The second issue involves the Title. In order to get a clear title, the judgment has to be resolved in the public records at the local courthouse. Chances are good that the Title Insurer will require that judgment to be satisfied prior to issuing the title insurance policy. Now, it may not matter so much on a purchase because the purchase money mortgage would still hold first lien since the judgment cannot attach until you own the property. I did see a refinance where the borrowers had to vacate the lien prior to the loan closing. They could prove the money owed was discharged but that didn't make a difference. The judgment creditors lien was still valid and the Title Co. demanded the lien be removed.

If it were me, I would go through the steps to have the lien vacated so that I didn't have to worry about it coming back to haunt me down the road.

Just my two cents and no, I am not a lawyer, lol.

[SunshineGal]

You're very welcome! I'm just happy I found a post I could actually help with, lol.