How To Remove a Vacated Judgment from Your Credit Report

Court judgments typically stay on your credit report for seven years from the date of filing. But what if a judgment was vacated by the court?

In an ideal situation, this vacated judgment would be automatically removed from your credit report as the credit agency collects data from the court system. Realistically, however, it may take some time for your credit report to be updated to reflect the vacated judgment, and it is wise to be proactive, particularly if you will be applying for a loan in the near future.

The first step is to obtain a copy of your credit report from each of the three credit reporting agencies (Equifax, TransUnion, and Experian). Reports are available for a nominal fee. Federal law also allows you to obtain one free credit report from each of the three agencies every twelve months.

Once you obtain a report, review it carefully for accuracy. Assuming the vacated judgment still appears on your report, you will have to initiate a dispute with each agency.

Each agency’s process may be slightly different, but you will need to provide each agency with a letter disputing the judgment along with the court order vacating the judgment. Depending on the agency, you may be able to submit the court order online. The dispute generally must be resolved within thirty days.

Lawsuit Abuse Reduction Act Proceeds Through Congress

Legislation designed to help small businesses by reducing frivolous lawsuits in federal courts is making its way through the U.S. House of Representatives.

H.R. 2655, the Lawsuit Abuse Reduction Act of 2013 amends Rule 11 of the Federal Rules of Civil Procedure to strengthen sanctions against parties and lawyers who file unmerited lawsuits. Specifically, the bill:

• Reinstates sanctions for the violation of Rule 11;
• Requires judges to impose monetary sanctions against lawyers who file frivolous lawsuits, including the attorney's fees and costs incurred by the victim of the frivolous lawsuit; and 
• Prevents parties and their attorneys from withdrawing frivolous claims after a motion for sanctions has been served.

Bill sponsors hope that the increased sanctions would discourage frivolous suits and claims, allowing business owners to use resources to expand their business rather than defending lawsuits in federal court. Moore & Van Allen’s Litigation Blog has a detailed explanation of the changes to Rule 11, which could affect all attorneys and parties in federal court.

The bill was recently passed by the House Judiciary Committee and is now pending before the full House. A companion bill, S. 1288, is under consideration by the Senate Judiciary Committee.