How do you Remove a Judgment from your Credit Reports

August 17, 2018 by CreditRepairGuy Leave a comment

This is not one of the easier things to remove from a credit report.

The first question is: Has the judgment been paid or satisfied?

And the second question is: Has the judgment been vacated?

Third: On which credit report does the judgment appear?

And Fourth: Did the creditor sue the right person to begin with? Or was it Identity Theft or a Case of Mistaken Identity?

I just wanted you to see this up front because it’s important: Just because something is not listed in your credit reports, this has nothing to do with whether or not you still owe the debt. Many things that you do owe, won’t show up in your credit reports. That’s not a bad thing unless you cannot remember whom you owe money to, such as when you want to file a bankruptcy.

An unpaid judgment is the worst thing to have on your credit reports, well second to a foreclosure and about equal to an eviction. An unpaid judgment means that there is a creditor, or the plaintiff, who sued you and won. That creditor/plaintiff can use that judgment to, at any time, garnish your wages if you have a job, levy your bank accounts and take all of your money, (with some exceptions such as with Veteran’s Benefits and Social Security money), and put a judgment lien on your home or other real estate holdings if you own any.

If you need to buy a car, potential new car lenders won’t want to lend to you because if your wages start being garnished then you won’t be able to pay for the car and the lender will have to repossess any car he might sell to you. Property managers won’t want to lease or rent to you because you might miss months of rent, because your bank account was drained by the judgment and then they might have to evict you and that costs extra money they probably will never recoup and might not be able to afford to begin with.

Assuming a couple of things up front, such as that you are the person who owes the money and that you haven’t paid the debt off yet, then you’ve got to do something about the debt.

You can:

Pay the judgment or settle it
Have the judgment vacated or set aside (see first bullet point supra)
Fight the judgment’s validity
Do nothing and hope the creditor/plaintiff forgets to renew it after ten (10) years
File bankruptcy

Paying or settling the debt will mean that a satisfaction of judgment can be filed with the court where the judgment was entered. The creditor usually does this but if they don’t, or forget, or just don’t care, then you can do it yourself. Eventually the satisfaction of judgment will be reported on your credit reports and that’s good for your credit. However, you’ll still have a judgment on your credit reports. Paying it off doesn’t take it off of your credit reports. But still it’s better than being garnished or having your bank accounts levied which is what will happen if you do nothing. (Unless of course you’re self employed or unemployed, because then you can’t be garnished. If you don’t have a bank account or don’t keep money in your bank account then your money won’t be levied when the creditor serves the bank levy on the bank.)

Vacating the judgment or filing a motion to set aside the judgment gives you the best result possible. If you can afford to pay the debt or to settle the debt for close to the full balance, or if necessary, over the balance, then the creditor might be persuaded to file paperwork with the court to vacate the judgment. Vacating the judgment takes some extra paperwork on the creditor’s part and that creditor/plaintiff usually won’t bother for less than a very high percentage of the balance. A vacated judgment if you can get it done has the effect of basically telling the world that the lawsuit never happened. Credit reporting agencies don’t report judgments where there is no judgment. Sometimes however, you have to ask them to remove a vacated judgment and sometimes you have to threaten them with a lawsuit and sometimes you might have to actually sue the credit reporting agencies to get the credit reporting agencies to comply. However, most of the time it won’t come to that.

Fighting the Judgment’s Validity can sometimes work too. Rarely, but sometimes, you might have a viable defense against the judgment such as you were out of the country or out of state when it was “allegedly” served on you at your place of residence or work at time the Creditor/Plaintiff claims you were served. When you can prove that you were in Figi or Cancun passed out on the beach and your friends have the Facebook and Instagram posts to prove it, you might have a good defense to the judgment. There are very few defenses to a judgment once it is entered, but if you weren’t served, that’s a defense that can still work for you. If you don’t mind paying your own attorney some good money to prove it.

Under the Fair Credit Reporting Act (or FCRA) a judgment will remain on your credit reports for seven (7) years but longer if the length of time that the judgment will remain valid is longer than the seven year period. For instance in California, a Judgment is valid for ten (10) years from the entry date of the judgment or from the Renewal Date of the Judgment.

Judgments in California can be renewed every ten (10) years if renewed prior to the expiration date of the previous judgment. This can be done for an unlimited number of times in California. If an Abstract of Judgment or Judgment Lien (in California) which has been recorded in your local County Recorder’s Office, as a judgment lien against your home or other real estate, then the lien is also good for ten (10) years or until the Judgment Fails to be Renewed. When the Judgment is Renewed, then the Creditor/Plaintiff must also record a copy of the Application for Renewal with the County Recorder’s Office in order to preserve the validity of the Judgment Lien or Abstract of Judgment.

If you do nothing about the judgment, in California, then whenever possible, the creditor/plaintiff will garnish your wages, record the Abstract of Judgment at your local County Recorder’s Office thereby creating a judgment lien on your home and other real estate, and on top of that, every few months the creditor/plaintiff can levy your bank accounts. They can also do something embarrassing and potentially devastating which is to have you brought into court for a judgment debtor’s exam. You receive a subpoena ordering you to go to court to explain the nature and location of your assets under oath under penalty of perjury and if you don’t show up, the court issues a warrant to arrest you. You make a rolling right turn, get caught, and go to jail. But if you’re Judgment Proof, in other words, you’re on social security disability, VA Disability, or are otherwise unemployed with no income or a protected income and you don’t have any bank accounts and you don’t own any real estate, then they can tell their tale to the judge but they won’t get anything.

If you file bankruptcy against the judgment creditor/plaintiff, then at least the judgment will be void, but it will still be on the credit reports for the full seven years from the entry date of the judgment. Additionally, the judgment creditor/plaintiff will no longer be able to renew the judgment lien or Abstract of Judgment because a void judgment cannot be renewed. If the creditor attempts to do so, then you can sue him for violating the discharge injunction as provided by the bankruptcy code.

In cases of Identity Theft or Mistaken Identity, you are supposed to be able to get the creditor and credit reporting agencies to vacate the judgment based solely on the mistake. You must of course prove the mistake. If you were a victim of Identity Theft and the identity thief opened several accounts in your name, it may be easier to prove that this judgment was also one of those incidents of malfeasance. With a Mistaken Identity, it may be a little harder. Especially if you have an extremely common name such as Smith, Jones, Nelson, Guerrero or Patel. A friend of mine, an Attorney named Bill Johnson, was contacted by a guy coincidentally named Bill Johnson who was being sued by the Los Angeles County Child Support Enforcement Office. Bill went into court and said: “Good morning your Honor, I’m Bill Johnson representing Bill Johnson and he’s not the father and neither am I.” The account was considered “satisfied” and the case dropped.

In Summary, if the judgment is unpaid, then the creditor can collect from you. If you have no assets nor income that can be collected from, then he can’t collect from you. If you file bankruptcy, then he can’t collect from you unless the bankruptcy code allows it for some reason, which is rare. If you are able to pay then the debt will eventually reflect that the judgment was satisfied and that’s good for your credit scores and also tells future creditors that this judgment is at least benign and can no longer cause trouble. If you can pay in full, close to it, or sometimes over, you could get the creditor to help you to petition the court to set aside the judgment or vacate the judgment. The credit reporting agencies such as Trans Union, Equifax and Experian don’t report vacated judgments. However, you may have to ask them to remove the judgment or even threaten them to get it done.

This Just In: According to an article published by Experian in June of 2018, they no longer routinely report judgments. This article is still important because they apparently haven’t gone back into your credit reports and removed all the judgments which were already reported. Those are still there. However, they are no longer collecting new public records of judgments and reporting them except for bankruptcies. Click Here For More Information.

How to write a credit repair letter to Equifax, Experian and Trans Union

August 9, 2018 by CreditRepairGuy Leave a comment

If you actually had to look up all of the statutes and codes involved as well as knowing the correct case law to reference in the letters, this would be a daunting task.

You can repair your own credit yourself. There are several basic guidelines, and knowing them will help get you started.

First, you’re going to need your credit reports so that you know what is in them that needs to be disputed. You can get all of your credit reports for free at www.AnnualCreditReport.com and there are other places too as long as you have previously gotten them for free within the last twelve months.

Second, you have to write letters to the credit reporting agencies disputing the validity of the information in your credit reports. You write one per credit reporting agency. In each one you dispute the negative information if it is incorrect and you can put multiple disputes on one letter but you must write separate letters to each of the credit reporting agencies.

Third, you have to make sure that you sign and date them.

Third, if at first you don’t succeed, try try again. The code says that the credit reporting agency, such as Experian, Equifax and Trans Union must “re-investigate” the disputes you send in and that means that if they reject it the first time, and if you know that the information in your credit reports is inaccurate, then you can ask them to investigate it again next month. And when you do, they have to re-investigate your dispute as many times as you send it in.

Fourth, don’t forget to dispute all of the inaccurate information. If you used to work at PetKo and your credit reports say that you worked at MedKo, dispute that too. If they say you used to live on Free Street but it was Fred Street, dispute that too. Get rid of extraneous addresses where you were only for very short stints that didn’t really count because they were so short or your credit reports will make you look like a gypsy. Not that there’s anything wrong with that, but do you realize potential employers also run your credit reports during the interview process? Employers want stability not nomadic millennials trying to find themselves by traveling around like Bob Dylan as a boy with a guitar and a harmonica. You’re probably not a poetic genius. Inquiries, if possible, and if disputable, get rid of them, you don’t want employers and potential new lenders to think you’re irresponsible with your finances by trying to run up as much debt as possible because that’s how multiple extraneous inquiries make you look.

Fifth, you can dispute anything that is incorrect. If the credit report indicates you owe $5000 but you know that it’s $5500 then it is incorrect and is supposed to be removed from the credit report. If when you make the dispute, the credit reporting agency makes it’s inquiry into the matter with the creditor, if the creditor doesn’t respond within a prescribed allotment of time required by the Fair Credit Reporting Act, then the credit reporting agency must remove the item from your credit reports.

Sixth, remember that the Federal Fair Credit Reporting Act states that a credit reporting agency must “re-investigate,” a disputed item. So if you dispute an item on the credit report and the credit reporting agency or the creditor instead verifies the incorrect information, you can still dispute it again. You can dispute it over and over again. You can also threaten the creditor directly with the proper kinds of law suits in order to express your legitimate concerns that they aren’t taking you seriously.

You Can Repair Your Own Credit

August 5, 2018 by CreditRepairGuy Leave a comment

I’ve used a credit repair service myself, and I’m an attorney. At that time, I didn’t know what to do, so I just hired someone.

So, why didn’t I just take some time to learn how to do it myself. There’s a simple answer to that. Attorneys are busy people, me included. For me it’s even a little bit worse than for other attorneys because I like to manage my cases from the start to finish and from the ground up. I don’t use paralegals and my wife is my part time receptionist. I even answer the phones. It streamlines the way I do my legal business and my area of practice is bankruptcy. So I know a lot about ruining your credit. That’s easy, don’t pay your bills, get sued, have a car repossessed and voila your credit is toast. Perhaps, I should have added a picture of a toaster instead of my cat.

In my law practice I pretty much only take bankruptcy cases, I don’t have a lot of spare time to learn a new kind of case, or at least I don’t have time that I want to devote to learning new types of cases. Being a bankruptcy attorney is time consuming enough, especially when you’re also a full time paralegal, full time secretary, and sometimes I have to empty the bins and vacuum. I like it, it’s a quiet simple life that I enjoy, I love getting people out of debt.

However, all that said, and especially at that time, if I had had to spend the time to learn how to fix my own credit, I really didn’t have the time to do it. There are dense Federal Codes to study, and then the State of California has plenty of statutes that sometimes add things that aren’t in the Federal codes. Combing through the statutes and codes takes time, figuring out how to write credit repair letters would have taken a lot of time, effort and I knew that I just didn’t have that time. And sure once you’ve got the letter written, you can reuse it, we do that all the time but I hadn’t yet done my first one. And I didn’t want to learn.

So I started researching for a credit repair company or service near me. There were a few, so I asked a couple of attorneys I know and received a couple referrals.

$1500 dollars later I was on my way to clean credit and a new life and a new house.

So, I’m not a complete dork, and I know that the paralegals do most of the real work so I spent a little time letting my wife speak to the attorney while I walked around getting lost on the way to the restrooms and what I learned was that the paralegals were using basic templates to write letters and that those basic templates came from a credit repair guide book which had been printed out, three hole punched and clipped into a binder. You see, I had seen a guide to credit repair on the Internet but I thought it was a scam, because I was an attorney. I ignored it. Yet, here it was, the company charging me $1500 was using the guide that I had ignored.

So I said earlier that what I found out that these companies do, surprised me. And it did surprise me, because while they’re doing proper legal work for you, they’re just doing basic DIY credit repair for you that you can do for yourself. You can repair your own credit.

Yes, there is a big secret to credit repair: you can do it yourself. The guy doing my credit repair so that I could refinance my house and buy a second house was using a guide that he had downloaded from the Internet, three hole punched and shoved into a three ring binder. I guess the binder made it official.

I know that most of the time, in most law practices we use those kinds of things. They just normally come from a seminar costing $500 to $5000 and the books are an extra $500 to $1000 with an annual update costing $250 to $500 and still requiring a lot of expertise to make sure that they are properly implemented. Yet to repair my credit, it cost that firm around $37 or $47 and he was charging me $1500. That’s a good deal.

Of course you can do a lot of kinds of legal work yourself, people do their own divorce work all the time, but it’s complicated, fraught with pitfalls and you can easily make mistakes. And if you make enough mistakes, you can prejudice your judge against you and then you’re in a world of hurt. That’s true with most types of legal work.

But in credit repair work, you’re almost never in front of a judge, and because of the way the laws about disputing things on your credit reports is written, if you do it wrong this month, you can try again next month.

Keep researching, you’ll find that there are lots of excellent sources for exactly what you need to do to repair your own credit. There’s a ton of excellent people educating the public on Youtube and other sources. Good luck.