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map211999

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Pay off Judgement or Increase Secured Card Limit
I have a unique situation. I am cash and asset rich but credit poor. I have a 15k Judgement from an auto loan. A 626 credit score, and 2 paid for condo's worth 30k each. My current score suffers because I only have 1550 dollars worth of credit over 2 cards and I need to average 2000 per card. My goal is to increase my score enough so that when I drop the cash on the Judgement and have it removed I can then gain a mortgage on one of the condos to replace the cash that I have just spent. So LSS should I increase my secured card limit to say 3500 and hope for an score increase or just pay the judgement that's 6 years old and see what that increase will be.

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Pay the judgement first.

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That judgement is, in fact, a matter of public record that is going to remain a "negative" on your credit report until such time as it is paid off, and then it could still be noted as part of your credit history for 7 more years, when it will drop off the report as if it never existed.  Right now, it's the judgement that's hurting your credit score the most.

Once that is totally off your credit record, then you'll find the ability to get more credit increases.  Potential lenders don't like to loan to someone who has a judgement since the judgement would have priority over any credit account in the event of bankruptcy or other legal action. 

After the judgement is cleared out, you may find yourself eventually able to have a "normal" credit card and be able to get a better rate on any potential credit accounts.

I do suggest building a savings account for "just in case" situations.  Never hurts to have readily available cash on hand.

Hope this helpa.

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map211999

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Thanks for your response.  It is becoming pretty clear there are limited improvements that I can expect until resolving the judgement.  I've managed to increase my score by 120 points over the past 2 years but have hit a plateu with this Judgement. 

From my other reading I know I may be able to settle this judgement for less than owed and also get it set aside. I'll take all my money out of the bank and then send a letter to the lawyer and see what they are willing to do. Should I offer a settlement, payment terms, or just send them a general leter asking for info on the judgement.

Thanks

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