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Judgement SOL and renewing of Judgement


shegler
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I need clarification concerning judgements SOL and the creditors ability to renew the judement again to continue to collect forever. I hope I am in the correct area to ask this question. I have the Good Credit is Sexy book and I cannot put it down because it is so informative. I am a little confused concerning judgements. Unfortunatley I have one judement and my husband has two. My question is- I know that the SOL for judgements in my state of N.C. is 5 years. I have a judgement that was filed in 8/2001. The SOL would be up this month according to the 5 years for my state. For the creditor to be able to renew this judgement and continue to collect and change the filing date that would carry another 7 years on my credit report, do they have to renew within the first five years or can they renew all the way up to 7 years when it is due to come off of my credit report? I guess I am confused about the whole renewel process. I just don't want these creditors to keep renewing these judgements with myself and my husband. I hope my question is clear. Thanks!

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Guest E. Normis Debtor

I believe the SOL for a judgment in NC is 10 years, but check the statutes to be sure. It is renewable every 10 years until paid. The FCRA allows judgments to be reported through expiration of the SOL, so if it's not paid and renewed, theoretically it could remain on your credit report forever.

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According to the"Good Credit is Sexy" Book it says SOL on Judgements is 5 years in the state of NC. My question is can they renew the judgement at anytime within any time period? Do they have 5 years because of the SOL to renew within that time period? can they renew after 5 years afeter filing with the courts? If they can renew anytime, what does the 5 year SOL mean? I just need clarification. Thanks!:confused:

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Guest E. Normis Debtor

The bad news is the book is wrong. NC statute 5 § 1‑47 indicates a 10 year SOL for non property domestic judgments.

The good news is it appears it cannot be renewed, but you'd want to confirm that with NC counsel.

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Boy am I confused now...:confused: So the SOL is 10 years for NC and so what does that mean? For 10 years they have the right to renew my judgement and add another 10 years? Or what you are saying that in the state of NC you think that by law they cannot renew the judgement? I read the link above you posted and it says: " Upon a judgment or decree of any court of the United States, or of any state or territory thereof, from the date of its entry. No such action may be brought more than once, or have the effect to continue the lien of the original judgment.

(1a) Upon a judgment rendered by a justice of the peace, from its date."

So the the book is wrong and also this site that gives the SOL as 5 years?

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Guest E. Normis Debtor

It appears it cannot be renewed. If that's the case, the judgment would fall from your credit report 10 years from the entry date of the judgment, and at the same time they would be barred from enforcing the judgment.

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SOL for GA according to this website is 7 years. But if it is incorrect for NC at 5 years, it may be incorrect for GA. You can find that info at the top of this website in the heading of Statute of Limititations and then select judgements and then you will be prompted to put in your state. But still I have not gotten the answer to my above question and I am confused. I wish someone that has a lot of knowledge concerning this will answer my questions. :(

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The whole SOL thing is intentionally confusing, and you do need to be careful when you try to apply it.

First (as I think you realize) SOL is a state by state thing. Furthermore, each state has their own opinions as to what the SOL laws apply to, and, as to whether or not a given action can be renewed for another time period. Each state has passed their own laws AND are continually "new and improving" those laws, so, whenever you want to invoke SOL, your best bet is to go look it up in your state's law.

Second, SOL is not the same as the length of time something can appear on your credit reports. That is controlled by federal law (specifically the FCRA).

Third, in all states (except perhaps WI and maybe CA) neither the SOL nor the FCRA defines how long a creditor can attempt to collect. As long as you owe them money (even if its a JDB), and, they haven't "written off" the debt for income tax purposes, they can try to collect. If they should take you to court, they still might win regardless of the SOL. In order to be protected by the SOL, you need to raise it as an affirmative defense. And, the court has to be savvy enough to recognize it as valid.

And, fourth, SOL on judgements is yet another problem. First of all, the creditor has already taken you to court and won. So now, their problem is how to take your money. Garnishment? Freeze your bank accounts? They have 5, 7, or 10 years to do that...and in some states, the can renew it for another time period.

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Guest E. Normis Debtor

Actually the 2 problem states would be WI and MS who's statute of limitations, for an obligation arising out of contract, operates as a statute of repose.

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Thank you Willingtocope and Enormis Debtor for your wisdom. I don't think in the state of NC you can garnish wages unless it is for taxes and child support. I do know they can seize your bank account because that happened to me first hand. I guess all I can do is pray that in seven years it will fall off of my credit whick would bee the year 2008 and they won't try to renew or would it be a better decision to try and pay the judgements off? The only thing I am afraid of if I pay off the judgements is that it will renew all over on my credit report and add an additional 7 years. Can that happen?

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Guest E. Normis Debtor

A judgment in NC can be reported on your CBR for 10 years, which is when the limitations period expires. Not sure how you're coming up with 7 years.

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E.Normis- You have been a big help. What is your advice to me. I want to refinance my home in 5 years. Would you try and contact the creditor and make arrangement to pay the judgements off, or pray that they will come off and as you pointed out they can't renew. I need some advice. :?

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Guest E. Normis Debtor

Guess I don't understand. If it's indeed your obligation, why wouldn't you pay it?

You mention refinancing your home in 5 years. Do you have equity in your home that would allow you to refinance it now, and roll that amount into the new mortgage? That way you're paying it back over a much longer period of time.

I don't know what exemptions are allowed in NC, but a judgment is a dangerous thing almost anywhere. What happens if they levy against your personal property, your checking account, or put a lien on your house?

Just some things to consider.

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When these judments were entered, our family went through a period of unemployment unfortunatley. We have for the past 5 or more years have pretty much paid cash for everything and have slowly re-esbablished our credit. Recently I wanted to pull our reports and really try and rebuild and make sure things were correct. A lot was reporting incorrect and I am in the process of disputing those items.. But now back to the topic at hand. I still do not have the funds to pay these judgements off in their entirety and I wanted advice on how to handle the best way possible.

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As to the initial question, a judgment can remain on your CR for up to 10 years, and found in public records section of your CR. If your state allows the judgment to be renewed, they may do so and it will remain active for the next 10 years. But, it can not be reported for another 10 years. BUT, when mortgage lenders, for example, do their credit research, will usually find a renewed judgment as it will still be in the public records for the court in the county the judgment was granted in. Trust me, those who do the research do check this.

All a lender wants when approving a loan is that a judgment be reported as satisfied, this includes the consumer having a letter from the creditor, all collections be reported with a zero balance, and any incorrect information being corrected, if it can affect your scores.

It was mentioned as to having the funds to pay them. I would advise that the OP send a letter offering to settle for an amount less than award, maybe $.50 on the dollar. Sometimes, they will be accepted. If not, go ahead and pay it. Now, do not mention in any way, including not applying for credit of any sort, that you want to refinance your home, or anything. Sometimes they will pull a soft to see what you are up to before accepting an offer. Also in your letter make it clear their response must be in writing and signed by an officer of the company. When an agreement is made, make it clear that upon receipt of your payment, in the form of a MO of Cashier's Check, they will respond in writing the judgment is satisfied. This will be your receipt to show a lender just in case they are slow in getting the TL corrected.

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Thank you Retmar for your information. I know two of the judgements were with Wachovia Bank (was First Union). The bank sent the collection to a lawyer who filed the judgement and now collects 100.00 a month from us and has been for the past two or three years. This is the lawyers office that had seized our checking account years ago. We are not even sure which Wachovia account we have been paying each month. Should I still call them and see if they will settle for less to mark at least these two as satisfied?

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Yes, you can send them an offer of settlement. Use whatever reason you want. Be very polite and precise in your request. Just tell them that it is your desire to resolve this whole matter now, for whatever reason, and, you have this much money you can send in a MO or cashier's check the day following your receipt of their written agreement to your offer. But, offer maybe a third as if they do accept it, they will want at least 75%. At that time, you counter with maybe 55% as a stretch.

Remember, since this involves a judgment, they are under no obligation to accept. But, since you've been paying for more than a year, they've received a fair amount of interest, which can cause them to look at the whole account and monies received to possibility accept the offer. All they can say is no. Then you wait a year and do it again.

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