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What this task is

This task collects complete, unredacted documentation for any outstanding judgment reported in the borrower’s profile. Judgments may arise from:
  • Civil lawsuits,
  • Unpaid debts that have been reduced to judgment, or
  • Other legal actions filed in court against the borrower.
The goal is to understand the nature, balance, priority, and resolution status of each judgment.

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When this task is required

This task is required when:
  • The borrower’s credit profile, public records, or application indicates the presence of outstanding judgments, and
  • The loan program requires underwriters to evaluate and document how those judgments will be handled before or at closing.
Judgments often appear on:
  • Credit reports,
  • Public record searches, or
  • Borrower disclosures during the application process.

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Why this task is required

Outstanding judgments can:
  • Represent significant unpaid obligations,
  • Lead to liens against the borrower’s property or assets, and
  • Affect the lender’s lien priority and risk of loss.
Underwriting must determine whether:
  • The judgment must be paid off in full,
  • It can be subordinated or satisfied through an agreement, or
  • It can remain outstanding under specific program allowances.
Without full judgment documentation, the lender cannot:
  • Accurately assess risk and lien priority, or
  • Confirm whether the loan meets agency, investor, or internal policy requirements.

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Documents needed to resolve this task

To satisfy this task, provide:
  • Complete court documents related to the judgment, such as:
    • The judgment order or decree,
    • Any recorded liens or abstracts, and
    • Documents showing case number, parties, and balance.
  • If the judgment has been paid, settled, or satisfied, provide:
    • A satisfaction of judgment, release, or equivalent court filing, and
    • Any payment documentation or settlement agreement that confirms the terms.
  • If a payment plan or negotiated settlement is in place, provide:
    • The written agreement and
    • Evidence of recent payments consistent with that plan.
These materials allow the underwriter to determine the required treatment of the judgment (payoff, subordination, or ongoing) and ensure the loan complies with applicable guidelines.