@Anonymous wrote:
Honestly, I don't now. it might just be through the county records or a federal database. I am not sure. I just know that they do. I have heard a couple times of people getting something that slips through, but that is rare.
I agree that "the system" is getting better at catching judgements...but many still fall through the cracks. That's because there is no foolproof system.
A lot depends on the credit report. If the judgement is not on the credit report, then it is possible that it won't be discovered. If it's not on the credit report, geography comes into play. The judgement is filed in a county courthouse against the person....likely the county where the person lived when they got the judgement against them.
The title insurance company will search for judgements in the county in which they are located. If the person got the judgement before they moved into the area, that judgement may be sitting in a courthouse somehwere far away. The title company normally won't find it unless they search in counties where the buyer used to live. I know that the title insurance company we use does not do that. They look in our county only.
Now, judgements can be moved to follow the person, but, with the advent of today's credit reporting systems, creditors are not as likely to move judgements around to follow the person.
There are a few caveats here...some states have very good reporting systems. In the boondocks where I live, it is sometimes very difficult to track down even local judgements. It is very time consuming because it is a manual system in our courthouse. There is no electronic system that picks up our judgements. So, when a judgement disappears from the credit report, it takes someone to manually track down that judgement. Not all states are as backwoods as we are though.
All that said...as a former broker, I would advise the OP to pay the judgement before attempting to get financing. Just because it went off a credit report once doesn't mean it won't be sold to a collection agency and show up again...and that could be right before closing. The reason they don't like you to close with a judgement against you is that the judgement will then go against the property. It's a messy business if you get caught being less than truthful.
