Court Judgments and Credit Reports

money-judgment-credit-reportsThere are some major changes underway in how public records like court judgments (including small claims court judgments) and tax liens are reported to the three major credit bureaus Experian, Equifax, and Transunion.

These changes are due in large part to a new “National Consumer Assistance Plan,” that followed a multi-state settlement in 2016 involving 31 state attorneys general over problems with credit reporting accuracy and correction of errors on credit reports. A March 2017 report by the Consumer Financial Protection Bureau also found problems with accuracy and outlines the recommended steps for improvement.

Effective July 1, 2017, Experian, Equifax, and Transunion have begun removing tax liens and civil judgments from credit reports when the information gathered from the courthouse does not include key data elements including social security number and date of birth. This means that most California Small Claims Court judgments will no longer be automatically reported to the Bureaus because it is very unlikely that information will be found in the record.

When we purchase California small claims court judgments, part of our judgment enforcement process is gathering all of the necessary information that the Bureaus require and then promptly reporting and following up with each Bureau to ensure inclusion. After all, an uncollected court judgment is a legitimate debt that remains unpaid so potential creditors should be made aware of that fact.

Reporting bad debt is smart business. As Tim Coyle, a senior director for the public records giant LexisNexis Risk Solutions, explained to the Washington Post, “…statistically borrowers with either a tax lien or a court judgment are over five times more likely to default versus borrowers who do not.” It’s critical then that we do our part to make sure the credit reports of judgment debtors are accurate and reflect this legitimate, yet unpaid, debt.

If you have an uncollected small claims court judgment, please read more about how we work here. If you believe your unpaid judgment meets our requirements, please submit your case for a prompt review. If it qualifies, we may be able to turn your uncollected money judgment into cash.