Judgments May Prevent the Ability to Buy or Sell Property for Decades

When most consumers learn that there is a money judgment against them, they instantly think about the debt amount involved. Often, the other negative consequences of judgments can be just as bad if not worse than the debt amount owed. Most consumers learn that a judgment has been entered against them years later when their bank accounts are frozen, or they receive a wage garnishment notice to their job. A more frightening but frequent way of learning about a default judgment is when a consumer is in the process of buying or selling a home. A title report is usually issued and shows the judgment. The bank and almost all parties involved in the mortgage process will instantly state that the judgment must be resolved before the process can move forward. This leaves consumers frantic about the possibility of losing the dream home that they have worked so hard to purchase.

The parties involved in the mortgage process are usually not as concerned with the amounted of debt owed as opposed to the judgment itself as it is a major red flag in the process. Judgments are so dangerous because they are valid for 10 years when entered in New York and renewable for another 10 years. Not being able to buy or sell property for 20 years is difficult to comprehend. Finding old judgments can be tricky because they are not reported after the 7-year reporting deadline passes on credit reports. It is critical to move to vacate a default judgement in this type of situation once found. Retaining an attorney and filing a motion to vacate the judgment alone is usually enough to reassure the bank and other parties involved that the situation is going to be resolved and that they can move forward. However, the bank will usually want a stipulation or order showing that the judgment has been vacated. A failure to resolve an outstanding judgment matter because of a lack of concern for the debt can have two decades of negative consequences for a consumer.