I have paid off my judgement and the collection agency has failed to release the judgement. what can or do i do?

Florida has a similar statute to that referenced by my Georgia colleague--check out Section 701.04(1) Florida Statutes. That statute gives the judgment holder 60 days to record what in Florida is called a Satisfaction of Judgment and to send the recorded SJ to you. If the creditor does not do so, you can bring suit and have your attorney's fees assessed against the creditor, so your writing a letter to "remind" the creditor that a Satisfaction is still due is a great idea. Just be sure the Satisfaction has not already been recorded, but simply not sent to you--makes a big difference overall.
Here is some bad news: the recording of the Satisfaction may not have an effect on your credit score. The judgment will remain on your credit report for 10 years from when it was entered, even though it is been paid off.
Why? The fact that a creditor has sued you is considered to be a sign of poor judgment and/or exercise of financial discretion. You can not force the credit bureau to remove the judgment from your record.
Regardless, you would want the public records where the judgment was recorded to reflect that it had been paid off.
Good luck in your new home.

GA has a statute regarding this found in OCGA § 9-13-80. You can look up the statute online - the website is:
http://www.lexisnexis.com/hottopics/gacode/defa...
(I'd copy the statute but there is not enough room here).
You have to write a letter to the law firm which obtained the judgment. They had 60 days to satisfy the judgment. After 60 days its presumed untimely. I would write a letter to the law firm and include a copy of your settlement letter acknowledging the payment asking that they mark the judgment as satisfied and that they do it within 30 days of the date of your letter. Send the letter to the the law by certified mail or by some other means by which you can track it. Cite the statute and tell them that you will get an attorney and sue for damages. Under the statute you get $100 plus attorney fees if the law firm does not comply. Also ask the law firm to send you a file stamped copy.
If you do not receive a file-stamped copy and there is no record of a satisfaction on file, then you can obtain an attorney to file an affidavit with the court asking the clerk to mark the judgment as satisfied.
I am surprised that the law firm did not mark the judgment as satisfied. When I settle debts for clients, I try to make sure that this is done. Some law firms do not always file the satisfaction right away and often there is a delay in filing the papers and waiting to get them back from the courts. However, 4 months is inexcusable. Did you settle the judgment with a law firm?
If you need assistance in sending the letter, I can do it for a flat fee of $125. Please contact me at rqchelforjustice@hotmail,com if interested. I am a GA-licensed attorney.

Both Georgia and Florida have similar statutes regarding the requirement that the law firm record the satisfaction of judgment once the debt is paid. Even though the law firm is no longer there, the attorneys who obtained the judgment and accepted the money had the obligation to prepare and record the satisfaction of judgment on behalf of their client. In addition to the good suggestions above, I would suggest that you look up the attorneys who obtained the judgment on the Georgia Bar and Florida Bar website and contact them in writing and request they ensure the appropriate documents are recorded.