One of the most important reasons to check your credit record regularly is to check whether or not there are any judgments against you. A judgment is a court order, and the result is a tarnished credit record for 5 years.
If a consumer is defaulting on payments, a credit provider may request a judgment. Upon the request, a summons is issued to the consumer. This summons is normally sent to the place where the consumer agreed to receive communication from the creditor, including notices. The aim of the summons is to inform the consumer about the pending judgment and when they need to appear in court. If the consumer does not appear, the judgment may be issued in default. Therefore it is vital that a consumer responds to summons, as this may give the opportunity to explain their credit situation. A judgment stays on the consumer’s credit record for 5 years, and only then will it be removed. The only way to prevent a judgment is to prove that the debt is fraudulent, or that communication from the creditor was never received.
A judgment can be rescinded by a court, or if your circumstances meet those stipulated in the National Credit Act section 73. However, your credit record will still show a default for two years.
Debt counselling is not a remedy for judgments, but consulting with a debt counsellor could illuminate the situation and prevent future judgments if debt management has become an issue. Knowing when default judgments will be removed is important as it can help you plan your financial future and debt management strategy.
Article written by: Andrea van Tonder 02-2013