Judgment and Tax Liens

Judgments and Tax Liens


  • A tax lien is an involuntary charge placed against your property due to the  non-payment of taxes owed. A judgment is a judicial decree issued by the court  that specifies the amount of money you owe to a creditor. Under the Fair Credit  Reporting Act, negative account items generally remain on a credit report for up  to seven years. This applies to judgments and paid tax liens; however,  exceptions do  exist. In California, unpaid tax liens remain on your report for  up to 10 years but indefinitely in all other states.  Also in New York, paid  judgments can only remain on the report for up to five  years.

Your Rights on Judgments and Tax Liens

  • If you have a tax lien or judgment that has passed the applicable statute of  limitations under the Fair Credit Reporting Act, the law gives you the right to  dispute that item. You can file a dispute online at the bureau’s website. You  can also file a dispute by mail or phone using the bureau’s contact information  located on their website or on your  credit report.  The FCRA gives the bureau up to 30 days to investigate your dispute and remove  the items.

Deleted Judgments & Tax Liens does not get you off the hook

  • Even if a judgment is removed from your credit report, if it is unpaid, you  are still responsible for the payment of that debt. The statute of limitations  for the judgment to appear on your report is seven years; however, each state  has its own statute of limitations on how long you’re legally responsible for  payment of that judgment,  which determines how long the owner of that judgment  can come after you for payment. In Florida, the statute of limitations for  judgments is 20 years from the date the court issued it. Also, the issuer of an  unpaid tax lien can still pursue payment from you even if the lien no longer  appears on your credit report.

Beware of Credit Repair Companies

  • According to the Federal Trade Commission,  watch out for credit repair companies that promise to remove derogatory items  from your credit report, including tax liens and judgments. This could be a  scam. Bureaus are only required to remove erroneous, inaccurate or outdated  information from your report; they are not obligated to remove accurate data  from the report, even if it is negative. The Fair Credit Reporting Act gives you  the right to correct errors on your report yourself for  free.

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The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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