One of our readers wrote us recently, asking how long it takes for credit card judgments to come off a credit report:
I have two credit card judgments on my credit report that were placed in 2011. They are listed as debt collection companies, not the credit card companies. The original debt (last non-payment date) was July 2007. Can they still continue to add/renew these? Is the judgment date from last payment date like your credit report? Or the date of judgment? How long from now before they come off? The amounts are far above anything I can pay.
Credit card companies often sell the unpaid debts to third-party collection companies, so it’s not uncommon for a judgment to be reported by the collector (rather than the credit card company.)
The statute of limitations to collect on judgments is quite different from traditional debts, with many lasting as long as 10-20 years depending on your individual state laws. The point being, once a collection makes it to judgment status, it’s not going to just go away or fall off your credit reports.
Credit reports will go by the date filed for judgments. Unpaid judgments remain for seven years from the date filed OR however long the statute of limitations on judgements is for your particular state — whichever is longer. It’s also important to understand that unpaid judgments can often be renewed. If you don’t address them, they can end up staining your credit reports indefinitely.
With all that being said, if you can’t afford to pay the debt, you may be able to negotiate a settlement for less. This may mean setting aside minimal payments each month to save up a reasonable settlement before making the offer. A lump sum payment can often entice the collector to negotiate and accept.
Unfortunately, once a collection makes it to judgment status, there really are only two ways to resolve it — either pay or negotiate a settlement, or file bankruptcy.
In the end, the best advice is to address a collection before it makes it to judgment status. This means understanding your rights under the Fair Debt Collection Practices Act and responding to a collection notice when the collector first makes contact — or at the very least, fighting the lawsuit and defending yourself if/when a collector files suit against you. It can be very tempting to ignore a collection in the hopes that it will eventually fall off your credit report and “go away,” but doing so can backfire if the collector sues and is awarded a judgment against you.
For a more in-depth look at judgments — your rights, how to avoid them, how to address them when they happen, and their impact your credit reports and scores — the following resources can help:
- Seven Ways To Defend a Debt Collection Lawsuit
- Creditor Gets a Judgment Against You – Now What?
- Help! I Found a Judgment on My Credit Report
- How to Kill Zombie Judgments on Your Credit Report
- Satisfied Judgments and Credit Scores