When a creditor takes you to court and wins, the court issues a judgment against you. This judgment becomes a matter of public record and appears on your credit report, significantly damaging your credit score. Understanding how long judgments stay on your Canadian credit report is important for planning your financial recovery.
How Long Do Judgments Stay on Your Credit Report in Canada?
A court judgment stays on your Canadian credit report for 6 years from the date the judgment was filed with the court. Both Equifax Canada and TransUnion Canada follow this rule. The entry appears in the public records section of your credit report and is visible to all lenders who review your file.
Can a Judgment Be Renewed?
This is a critical point for Canadians. In many provinces, creditors can renew a court judgment before it expires, extending their legal ability to collect the debt. However, a renewed judgment still falls off your credit report 6 years from the original filing date, not from the renewal date. Credit reporting timelines are separate from legal enforcement timelines.
What Happens to Your Credit Score?
A judgment is one of the most damaging items that can appear on a Canadian credit report. It signals to lenders that you failed to repay a debt to the point where legal action was required. A judgment can cause a score drop of 100 points or more, depending on your existing credit profile.
Does Paying the Judgment Help?
Paying a judgment is important. An unpaid judgment can lead to wage garnishment, bank account freezes, or liens on property in many Canadian provinces. However, paying a judgment does not remove it from your credit report. The status changes from outstanding to satisfied, which is better, but the public record entry remains for the full 6 years.
Some creditors will file a satisfaction of judgment with the court after payment. Make sure they do this, because you want your credit report to show the judgment as satisfied.
Disputing a Judgment
If the judgment is entered in error, if you have already paid it and it shows as outstanding, or if the dates are wrong, you have grounds to dispute the entry with Equifax Canada and TransUnion Canada. Provide court documentation as evidence. Under PIPEDA, the bureaus are required to investigate and correct inaccurate information.
Provincial Differences
The rules for how creditors can collect on a judgment vary by province. Ontario, British Columbia, and Alberta have different limitations periods and enforcement mechanisms. Quebec has its own civil code governing debt collection and judgment enforcement. For questions about the legal aspects of judgments in your province, consult a licensed insolvency trustee or a consumer law lawyer.
What Can You Do While Waiting?
While the judgment is on your report, focus on rebuilding the positive side of your credit file. Secured credit cards, on-time payments, and responsible credit use all help. Over time, a consistent positive track record reduces the proportion of your credit report that the judgment occupies.
FAQ
**How long does a court judgment stay on my credit report in Canada?** Six years from the date the judgment was filed.
**Does a judgment prevent me from getting a mortgage in Canada?** An outstanding judgment will almost certainly result in a mortgage denial from traditional lenders. Even a satisfied judgment can be a barrier. Rebuilding your credit profile after satisfying the judgment is the path forward.
**Can I dispute a valid judgment on my credit report?** A valid judgment cannot be removed before the 6-year window. However, errors in how the judgment is reported, such as wrong dates or wrong amounts, can be disputed.
Call (437) 755-6579 for a free consultation. We help Canadians across Ontario, British Columbia, and Alberta understand their credit repair options.