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If you have a judgment against you, you might be thinking that you should just pay the judgment and get it released.  And it’s true, that’s one way to handle it.  You could contact the judgment creditor and work out terms to pay the judgment.  But that may not be a good idea.

Why?

Because they are pros when it comes to settling judgments, and you’re not.  Here are just a few things you need to consider…

  • How would you know for sure if they were telling you the correct balance?
  • Do you owe interest and legal fees or not?  If so, how much?  And how do you know for sure?
  • Is it possible to settle the judgment for a reduced amount?  If so, how much?  And how do you know if you’re getting a good deal?
  • And then what happens after you pay them?
  • The judgment is supposed to get “released,” but what, exactly, does that mean?  And how–and when?–does that happen?  How long does it normally take?  How will you know when your judgment has been released?  And if it doesn’t get released, what then?

This article from our San Antonio debt settlement attorney will go over these issues and other things you need to think about before you consider trying to settle your judgment on your own.

How do I find out who I need to pay?

Get a copy of your judgment from the court where it was entered.  Once you get a copy of the judgment, you can call the law firm that handled the lawsuit and go from there.  Maybe that law firm is still handing your account, or maybe it isn’t.  The creditor might have “taken the account back” from the law firm.  If the creditor has taken the account back, then you need to contact the creditor directly.  In many cases, the creditor doesn’t even own the judgment any more, because they sold it to a third party “judgment buyer” company.

Bottom line: you just need to keep calling around until you figure out who you need to pay.

Can’t I just look at my credit report to figure out who to pay?

No.  All that will be on your credit report is the name of the creditor, the date of the judgment, and probably the judgment case number.  Your credit report will not say who is collecting on the judgment now.

Once I figure out who to talk to, how do I find out how much I need to pay?

Once you have figured out who you need to talk to–what company owns the judgment, who is handling the account (in-house, collection agency, law firm, etc.)–you can call that person and ask them what the balance is, and they will tell you.

If I ask the creditor for the balance, how will I know that the balance they tell me is correct?

You won’t.  It probably is, but it might not be.  Most creditors are honest, but some…well…let’s just say that you wouldn’t want to buy a used car from them.

The only way to know your balance for sure is to calculate it yourself.  To do that, you need to get a copy of your judgment and it closely: it will have the exact amount owed as of the date of the judgment and will say what interest and legal fees, if any, can be added to the judgment after that date.   Then you need to do the math to get the correct balance.

Even then, though, creditors are generally allowed to add legal fees after the judgment, so if you ask the creditor for the balance, you are “taking their word for it” that any legal fees they added to the balance were appropriate and legal under the terms of the judgment.

Can’t I just get the balance from my credit report?

No.  What appears on your credit report, if anything, is the amount of the judgment at the time the judgment was entered.  There could be, and probably will be, additional interest and legal fees owed.  Your credit report will not say whether “post judgment interest” or additional legal fees are even allowed, much less how much they are.

Once I figure out the correct balance and who to pay, do I need to pay it in full?

Not usually, no.  Most of the time, you can negotiate a reduced amount.

If I negotiate a settlement on my own, how will I know if I’m getting a “good deal”?

You won’t.  People collecting on judgments usually work on commission.  So the more they get you to pay, the more they make.

And remember…collecting on judgments is what they do all day every day.  So they are good at negotiating. And so are our debt collection attorneys.

What about getting the judgment “released?”  What does that mean?

Once you pay the balance in full, or the settlement amount if you are settling for a reduced amount, the creditor is required to “release” the judgment.  To do this, they file a document called a “release of judgment” in the court where the judgment was issued.  Depending on the circumstances, they might need to file a copy of the release of judgment in the real property records also.

What, exactly, is a release of judgment?

It’s just what it sounds like.  It’s a document that says that your judgment has been released.  It might say that the judgment was “paid in full” or that the judgment was “settled for a reduced amount,” but it doesn’t need to say either of those things.  It just needs to say that the judgment is released.

Do I need to do anything to get the creditor to do the release of judgment?

No.  Creditors are required to file a release of judgment when you finish paying them, and they all do.

When will the creditor do the release of judgment?

Most creditors will file the release of judgment within 30-60 after you finish paying them.

What if I need the judgment released immediately (“I’m supposed to close next week!”)?

You can ask them to give you the release sooner.  They might do it; they might not.

Don’t ever forget that the creditor sees you as one thing and one thing only: a person they can make money off of.  The more desperate you are to settle your judgment, the more they’re going to make you pay.  If you need a favor from them, like getting them to release the judgment in 2 days instead of 60, they will probably do it, but you’re going to pay for it.

So does the judgment come off my credit report once it’s released?

Not immediately, no.  The credit bureaus might not even “pick up on” (notice and process) your release of judgment.  If they don’t “pick it up,” then they will not update your credit report.  Even if they do “pick it up,” they might leave the judgment on your credit report for several more years.

Is there anything I can do to get the judgment off my credit report?

Maybe.  You should definitely notify each of the three major credit bureaus that your judgment has been released.  At the very least, they will update your credit report to show that your judgment it “satisfied” instead of “still owed.”  Depending on your circumstances and on that credit bureau’s policy, they might even delete the judgment entirely.

There’s a lot more to settling a judgment than I thought. 

Yes, there is.  Generally, you need to…

  • Figure out who owns the judgment
  • Figure out who to contact about settling the judgment
  • Figure out the correct balance
  • Negotiate a settlement
  • Hope that you’re getting a good deal on your settlement
  • Pay the agreed upon amount
  • Make sure that the release of judgment is filed
  • Then check your credit to make sure that it has been updated correctly

I’m not sure I want to take all that on by myself.  What can I do?

It is probably a good idea to look into having us help you settle your judgment.  We have settled hundreds of judgments, so we know who to contact and how to get a good deal.

Once you pay your settlement, we will follow up to make sure that the judgment release is filed.  If you need your release quickly, we will do our best to accommodate your deadline.  And we can help you get your credit reports updated also.

Get a free consultation

Call 844.334.4566 or fill out the contact form.  We will review your judgment with you and go over what we can do to help you.  The consultation is free, and there is no obligation.

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