Understanding and Paying Off Court Judgments: A Step-by-Step Guide

Most people incur bad debt at some point in their financial life. Sometimes this debt is in the form of judgments, which are debts that a court has mandated that you pay. These judgments show up on your credit report and negatively affect your credit. Paying off judgments will increase your credit score and help you get out of debt.

Step 1

First, read through your judgment and find out how much money you owe and to whom you owe it.

Step 2

Collect the needed funds, either through your current paycheck or by taking on extra work to be able to afford the payment.

Step 3

If you were unaware of the judgment, you can file a motion to vacate the judgment for improper service if you never received the summons to appear in court. Remember, you will have to file this with the court that processed the judgment.

Step 4

Contact the debtor, and find out their process for payment.

Step 5

Once the payment is made, make sure to report it to the court to show the judgment as paid in full. You will need to prove the payment through a receipt and fill out a request to vacate judgment form.

Tip

Check your credit at least once a year, and before each big purchase. You will not affect your credit score by checking it, but if a business "checks" your credit, your score will reflect each "hit." If you check your credit, you can ask the business if your score would get you the financing that you need. If your score is not high enough, they will be able to tell you without checking your credit.

Warning

Sometimes, even after you pay off your debts, they are not properly and promptly reported to the credit bureau agencies. It is your job to check up and to make sure that everything was done correctly.