If there's a Court Judgment on your Credit Report, there's a good chance it shouldn't be there, and today, I'm gonna teach you how to remove it!
When it comes to Court Judgments, I always get asked the same two questions: "How do they affect Credit Scores?" and "How do I Remove them from Credit Reports?"
Well, according to the three major Credit Bureaus (Equifax, Experian, and TransUnion), Court Judgments DON'T appear on Credit Reports, and they DON'T affect Credit Scores.
So you don't have anything to worry about, right? WRONG!
The Bureau's policy of not including Court Judgments is just that, a policy. It's not Law! It could change at any time! So, it's crucial to understand how these Judgments affected Credit Reports in the past, how they still impact us today, and how you can remove them if they appear in the future.
HOW THIS RELATES TO US
For those new to Credit Repair, a Court Judgment is a formal order given by a judge that demands payment of a debt or damages following a lawsuit.
It happens when you are granted credit or borrow money but fail to repay the lender, leading to legal action being taken against you.
Back when Court Judgments appeared on Credit Reports, their impact would vary based on the circumstances.
They could drop your Credit Scores by 100 points or more. Paid Judgments would appear on Credit Reports for up to 7 years, and Unpaid Judgments could remain indefinitely if the Judgment was renewed or until the statute of limitations ran out in that State.
Why did the Bureaus stop including them in their Reports?
In short: to avoid lawsuits.
Until a few years ago, inaccurate and inconsistent record-keeping between courthouses led to countless disputes because the Judgments did not meet the legal requirements to remain on people's Credit Reports.
The Fair Credit Reporting Act states if a Court Judgment is listed on a Credit Report, the Credit Bureaus must check it for updates every 90 days to ensure accuracy. And if that record is not checked, the Judgment is supposed to be removed from the Credit Report.
So, in 2015, to improve the accuracy of public record data collection and reporting, the three Credit Bureaus partnered with more than 30 US State Attorneys General and agreed to The National Consumer Assistance Plan.
Under this plan, the Judgments disappeared from Credit Reports, and the Bureaus stopped dealing with so many disputes.
The only catch: the policy isn't protected by law. The Bureaus can bring the Judgments back at any time. So, we have to be ready to Remove them.
THE THING TO REMEMBER
Court Judgments are Public Records, which means they have consequences even if they don't appear on Credit Reports.
Lenders and employers can still use them to decide your financial future. Creditors can garnish your wages and place liens on your property to recover the debt. And negative items stemming from the Judgments, like Late Payments or Collections, can still hurt your Scores.
So remember, if a Judgment doesn't appear on your Credit Report, you still have to deal with the financial impact.
If a Judgment appears on your Credit Report while the NCAP policy is active, contact the Credit Bureaus and ask why.
If a Judgment appears on your Credit Report and it's confirmed the policy has changed, it's time to get to work removing it!
And that's when you can use the Public Records system to your advantage!
WHY THIS IS IMPORTANT
Public Records are different from most negative items that appear on Credit Reports because the courts don't send them to the Bureaus.
Before the NCAP, the Bureaus bought the records from companies like LexisNexis, which collected them from public databases like PACER.
When the Credit Bureaus received the Records from LexisNexis, they often listed the Furnisher of information as the "Recorder of Deeds," the "Clerk of Courts," the "Magistrate," or the "Municipal Court."
They did not list the actual Furnisher!
This amounted to false reporting, which directly violated the FCRA and provided a perfect reason to Dispute the Court Judgment.
WHAT YOU NEED TO KNOW
Before the NCAP agreement, this was the proven method for removing Court Judgment from your Credit Report, and it's still the proven method used to Dispute other Public Records like Bankruptcies and Foreclosures.
First, as always, you begin the Credit Repair process by Disputing any incorrect information that appears on the Credit Report.
If you believe an error was made during the Court Proceedings and have evidence supporting your claim that could Vacate the Judgment, consider contacting an attorney.
If that seems intimidating, don't worry, there's still a proven dispute process you can use to Remove the Court Judgments from Credit Reports.
HERE'S HOW IT WORKS
STEP 1: Sign up for a PACER account.
PACER is a public records database that anyone can access for free, and companies like LexisNexis use it to gather our data.
STEP 2: Contact LexisNexis and request a Consumer Disclosure Report.
Thanks to the FCRA, they're required to provide you with a copy for free.
STEP 3: When you have the PACER account records and the LexisNexis Consumer Disclosure Report, compare the information you find.
Look for inconsistencies and Dispute them with LexisNexis just like you would with a Credit Bureau. They follow the very same rules.
If you can remove the Court Judgment from the LexisNexis Report, your odds of removing it with the Credit Bureaus seriously increase!
STEP 4: Dispute the Court Judgment with the Credit Bureaus.
Do this just as you would any other item. If the Bureau verifies the information, move on to the next step!
STEP 5: Send a simple letter to the Clerk of the Court where the Court Judgment was filed.
There is no need to get into details or specifics. Just say something like:
"I have a record from your court appearing on my credit report. I've disputed the item with the Credit Bureaus Equifax, Experian, and TransUnion - all of which confirmed the record was verified by you. Please provide the procedure in which you verify records with the credit bureaus."
Send this letter to the Clerk of the Court with a self-addressed, stamped envelope and your return address to make it easy for them to respond.
The Clerk of the Court will usually respond with a letter explaining (what you already know) they DO NOT report to the Credit Bureaus.
STEP 6: Make a copy of the letter you received from the Clerk of the Court and send it to the Credit Bureaus along with a demand for deletion.
It doesn't have to be written word for word. Still, it should be something similar:
"I have previously disputed (INSERT Public Record Name / Reference #) with you, and in response, you verified the item as accurate, stating that you have verified the information with the court. I contacted the court, and their response is enclosed. It is clear they do not report to you or any credit bureau for that matter; therefore, your initial response verifying the item with the court was either an error or a lie. Either way, the reporting requirements do not comply with FCRA § 611 (15 U.S.C. § 1681I), and the information must be deleted immediately."
The Bureaus know the law and understand they have a potential violation if they don't remove the item. So they will typically respond with a deletion.
If the Court Judgment is deleted, you'll soon be able to qualify for loans and lines of credit without dealing with the predatory, high-interest rates that keep people with bad credit stuck in the never-ending cycle of debt.
If the Bureaus refuse to delete the Court Judgment, despite your valid reason for removal, it's time to file a complaint with the CFPB because you are entitled to fair and accurate reporting.
If you'd like templates of these Public Record Dispute Letters, you can download them FREE at CreditRepairCloud.com/Public-Record-Dispute
MY FINAL POINT
Court Judgments may not directly affect Credit Scores at the moment, but they do a lot of indirect damage, and there's no guarantee the Bureaus will keep this policy forever!
So, avoid Court Judgments whenever possible, but if you can't, don't give up, you can still fight back!
I'll end by saying…
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