Reply
New Visitor
Blushroom
Posts: 5
Registered: ‎05-16-2013
0

How will settling old judgement affect my scores

  I have an old (2004) judgement that no longer shows on my credit reports.   Its a fairly large judgement around 16K and the creditor is willing to settle for less than 20%.  I am wondering if settling this will bring this back up onto my credit reports and knock my score back down or if settling it after this long won't have any affect on my scores.  I would like to settle it either way, but if it's gonna bring it back up onto my reports for another 7 years I think I'll just forget about it again.

Moderator
guiness56
Posts: 22,408
Registered: ‎01-17-2008
0

Re: How will settling old judgement affect my scores

[ Edited ]

No, settling it will not put it back on your credit report.  It is too old.

 

You are still probably within your states SOL on collections of the judgment which means they could garnish your wages if the state allows that.

Established Contributor
ezdoesit
Posts: 1,048
Registered: ‎03-16-2013
0

Re: How will settling old judgement affect my scores

I give you credit for wanting to settle a debt that's SOL is probably over.  I think it shows good character on your part kudos.

New Visitor
Blushroom
Posts: 5
Registered: ‎05-16-2013
0

Re: How will settling old judgement affect my scores

    Thank you for your reply.  That's what I was hoping:smileyhappy:

Established Contributor
ezdoesit
Posts: 1,048
Registered: ‎03-16-2013
0

Re: How will settling old judgement affect my scores

What state are you in?

New Visitor
Blushroom
Posts: 5
Registered: ‎05-16-2013
0

Re: How will settling old judgement affect my scores

  I am in Iowa.

 

Established Contributor
ezdoesit
Posts: 1,048
Registered: ‎03-16-2013
0

Re: How will settling old judgement affect my scores

SOL is 6 yrs on judgement max. 10.875% interest.  After a creditor wins a lawsuit against a debtor and is awarded a judgment by the court, there is a time limit for collecting that judgment. However, many states allow judgments to be renewed one or more times, which could substantially extend the enforceability of a judgment, if the creditor is vigilant about the renewals. This can potentially result in a permanent legal obligation until it is paid.

 

 

Senior Contributor
drkaje
Posts: 3,492
Registered: ‎07-25-2008
0

Re: How will settling old judgement affect my scores

If it's past SOL, you're probably just paying off someone who purchased junk debt for pennies on the dollar.

 

If you're actually paying the original creditor, it makes sense. If they've already sold the debt and taken a loss, even sending in a token payment might cause them accounting issues. By accounting issues, I mean they would have written off the debt as uncollectable and have to do something tax-wise to correctly accept the funds.

 

Personally, I would not pay junk debt that is essentially uncollectable. I'd check the state SOL before doing anything.


Starting Score: 675
Current Score: EX 753 FICO, EQ 737FICO, TU 738
Goal Score: 776 FICO


Take the FICO Fitness Challenge
Established Contributor
ezdoesit
Posts: 1,048
Registered: ‎03-16-2013
0

Re: How will settling old judgement affect my scores

Pesonally if you have the money I would take the settlement so you don't have to look over you back again.  Get everything in writing.

New Visitor
Blushroom
Posts: 5
Registered: ‎05-16-2013
0

Re: How will settling old judgement affect my scores

   Yes, I am wanting to get a new house this fall and know this will come up during the mortagage process so I figure I better get it taken care of soon rather than later if I can.


myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.

>> About myFICO
FICO Score - The Score that matters
Click to Verify - This site chose VeriSign SSL for secure e-commerce and confidential communications.
Fair Isaac Corporation is a BBB Accredited Financial Service in San Rafael, CA
FOLLOW US Social Media Facebook Twitter Pinterest Google+
}