11 Mar From Red Flags to Green Lights: Removing Judgments
Declined. That cathartic word some of us see when applying for a loan, mortgage, or other line of credit. Imagine: You’re at the bank about to apply for a loan to buy that apartment. The teller explains that because of the presence of a prior judgment on your credit report, your request has been denied. The next step would be to go about removing the judgment. But how does one go about removing judgments from a credit report?
More importantly, what is a judgment, and is it possible to be rid of? Read on to discover what the red flags of judgments are, the negative effect they have on your credit report, and how you can get the green light: a clear credit report.
A judgment is a public record of the fact that you haven’t paid your debt. Essentially, it signals that a creditor sued you for not paying them back and won the case. It drags down your credit score by hundreds of points, staying on your record for about 7-10 years. Judgments usually arrive hand in hand with other negative marks, like delinquencies and bankruptcies. To check if you have a judgment against your name, use CreditBoost’s free credit score checker.
How to remove judgments from your credit report
Removing judgments from your credit report can certainly be a challenge, but is possible, especially with assistance from a legal professional. There are different strategies you can use depending on your circumstances, including paying off the judgment, negotiating the judgment, and seeking legal aid.
Pay off the judgment
This is the most straightforward way to remove judgments but requires budgeting and financial planning. Firstly, you’ll need to understand the totality of your balance: add up the principal debt amount, interest accrued, and court fees. You can get this information from judgment documents or creditors. After that, review your income and expenses to see if you can free up some funds to pay off the sum owed. It might help to create a budget to see where you can cut discretionary spending (dining out, retail therapy, etc.)
After you’ve saved enough to pay off the debt, it’s time to pay the judgment. Contact the creditor or the judgment-issuing court to see how you should pay.
Negotiate a settlement
This involves contacting the creditor to negotiate a settlement— an official agreement that settles a conflict. There are several steps to follow.
- Prepare: Gather all details about the judgment and assess how much you can afford to offer as a settlement.
- Submit a written request: The letter should explain your situation and how much you’re willing to pay while highlighting the benefits to them.
- Negotiate: The creditor might reject your initial offer, so prepare to increase your offer while staying within your budget. Also, be sure to discuss if you’ll be making a lump sum payment or monthly instalments.
- Written agreement: Get an agreement between you and the creditor in writing. It should state how much you’ll pay, the medium of payment, and most importantly, confirmation that the creditor will not revoke the offer.
Hint: Be polite and professional. Also, keep copies of all communication with the creditor, including letters, emails, and phone call records.
Seek legal aid
If negotiation is overwhelming or if there are legal issues, like procedural errors, it might be best to enlist legal help. An attorney can challenge the judgment’s legal grounds while explaining the process to you in a way that you understand. Cape Town Legal Consultants are experts in credit clearance. We have extensive experience in removing judgments, valid or not, from credit reports, as well as liaising with creditors and bureaus.
Contact us now for peace of mind and legal professionals on your side.