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Can A Lawsuit Ruin My Credit?

John – I was in a car accident and the driver of the other car hired an attorney who sent me a demand letter for $20,000. They have threatened to sue me if I don’t pay. Can this ruin my credit if I get sued?

Answer – A lawsuit will not have any negative affect on your credit reports or credit scores. Lawsuits are not picked up by or reported to the credit reporting agencies, Equifax, Experian and TransUnion, and if it’s not on your credit reports then no credit impact. Now, if the other driver does sue you and wins then you’ll have a judgment against you. Judgments are often picked up and reported by the credit bureaus so if that happens then yes, it will impact your credit. They stay on your credit reports for 7 years from the filing date.

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