Posted on: 13th Jul, 2010 09:17 am
I am in the process of paying off old debts and I received an updated CR yesterday that indicates I have a judgment against me from the state of CA for over $5K.
1. Can I get an FHA loan or any type of loan for a first time homebuyer with a judgment on my credit?
2. Do I have to pay the judgment in full or can I set up a payment plan and show proof that I'm paying this judgment?
3. Should I ask the state to settle this judgment or should I pay it in full?
I am really doing my best to get these bills paid off in time to purchase before the end of the year but this has thrown a curve ball in my plans.
HELP!!! :?
1. Can I get an FHA loan or any type of loan for a first time homebuyer with a judgment on my credit?
2. Do I have to pay the judgment in full or can I set up a payment plan and show proof that I'm paying this judgment?
3. Should I ask the state to settle this judgment or should I pay it in full?
I am really doing my best to get these bills paid off in time to purchase before the end of the year but this has thrown a curve ball in my plans.
HELP!!! :?
The general rule is that judgments must be paid in full. It's a bit late in the game to begin an arrangement with the creditor and try to establish a track record, as lenders will want to see a longer period of time that you've been paying. Settling is, I suppose, a possibility, but I don't see too many state governments in such a healthy condition as to negotiate judgments. If they can collect (and they can), they'll opt for that instead of settling (just my opinion of course).
As a first time homebuyer you can certainly be approved despite a judgment, but lenders are not going to be enthused about letting that judgment sit. As I noted above, it's typical that you'll be required to eliminate it entirely.
As a first time homebuyer you can certainly be approved despite a judgment, but lenders are not going to be enthused about letting that judgment sit. As I noted above, it's typical that you'll be required to eliminate it entirely.