Can Unpaid Child Support Affect My Credit?

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 What Is Child Support?

Child support is a court-ordered payment that is made by one parent to the other parent, for the benefit of their child. Child support laws in each state determine the amount of support based on custody, or how much time the child lives with each parent, as well as their income and finances. The parent who does not have primary physical custody of the child, or who lives with a child less than half the time, is generally the parent who is ordered to make child support payments.

Child support is intended to provide for the child even in situations in which they do not live with both parents. Because both parents are responsible for the financial support of their children, child support is necessary to ensure that both parents are fulfilling their financial obligations to their child.

Some examples of such expenses include:

  • Food, shelter, and clothing;
  • Medical care and health-related expenses; and
  • Educational expenses, such as paying tuition for private school.

Mandatory child support is the means by which the court can ensure that non-custodial parents are contributing to the needs of their children. The parent who is required to pay cannot escape that obligation, and the parent with physical custody of the children cannot refuse to accept the child support payments that the court has ordered for the child.

Either a mother or a father can be ordered to pay child support. Additionally, it is not necessary that the parents were ever married in order for a parent to be ordered to pay child support. In disputes associated with who the biological father of the child is, the court will generally order a test in order to determine paternity before calculating and ordering child support.

Finally, adoptive parents will be subject to child support laws; however, absent an adoption, step-parents are not obligated to pay child support to their step-children.

How Is The Amount Of Child Support Determined?

Each state has its own guidelines that are used to calculate the specific child support payment in each case, and the court determines this amount based on the specific circumstances of the parents who will be paying. These guidelines will generally give the court a range, and the judge will order an amount of money within that range. Additionally, some states give judges a considerable amount of discretion when determining the final amount, while other states require the court to follow considerably strict guidelines.

Some factors that are considered include, but may not be limited to:

  • The specific needs of the child, such as their healthcare needs and medical expenses, education, childcare, and other special needs;
  • How many children the parent is responsible for supporting;
  • The custodial parent’s income compared to that of the non-custodial parent;
  • The ability of the non-custodial parent to pay; and
  • In the case of divorce, the court might consider the child’s standard of living before the divorce or separation.

As part of the determination process, each parent must submit their financial information to the court, generally in the form of a financial statement outlining all monthly income and expenses. The court uses this financial information, as well as the amount of time that each parent spends with the child, pursuant to any custody arrangement and visitation schedule. They use this along with a child support calculator in order to determine the amount that will be owed each month.

Is Unpaid Child Support Considered To Be A Debt?

Unpaid child support is considered to be a debt, and similar to most debts, it can appear on your credit report. In most states, the child support enforcement agency is required to report unpaid child support debts once they reach $1,000. However, enforcement agencies may exercise discretion and report lesser amounts. As such, many states are also required to notify you before reporting the debt to the credit bureaus; you will then have a reasonable time in which to dispute the amount of the debt.

When notified by your state’s child support enforcement agency that you have a debt, you should respond as soon as possible to come to an arrangement with the enforcement agency. You can begin paying off the debt in exchange for them not reporting it to the credit bureaus, as the child support enforcement agency can assist with a plan that allows you to continue paying, and not increase the debt.

A child support debt that is reported to the credit bureaus can show up on your credit report in a few different ways. It might be classified as a “collection,” which is reported by child support enforcement agencies or when the custodial parent turns to a collection agency for help collecting the past-due support.

Unpaid child support could appear on your credit report as a court judgment following a court proceeding, initiated by either a child support enforcement agency or custodial parent. A court judgment might result in enforcement measures, such as:

  • Wage garnishment;
  • Property lien; or
  • Confiscation of the non-custodial parent’s tax refund.

Unpaid child support debts that are classified as “collections” or as “court judgments” will have a negative effect on your credit score, as they can lower your score by as much as 100 points.

It might also appear on your credit report as a “tradeline.” Tradeline is a term that is used by credit reporting agencies to refer to all of the credit accounts on your report. Federal law requires child support enforcement agencies to report the names of non-custodial parents who owe overdue child support debt, as well as the amount of support they owe. That information appears as a tradeline or credit account, and does not impact your credit score.

However, because the unpaid support obligation appears on the report, lenders or creditors may take it into consideration when evaluating an application for credit. As such, it could still negatively impact your ability to secure a car loan, credit card, mortgage, or some other line of credit.

It is imperative to note that paying off the balance of unpaid child support will not remove the debt from your credit report; rather, it will be marked as “satisfied.” The Fair Credit Reporting Act (“FCRA”) limits how long negative information can remain on a credit report. Generally speaking, negative information should be removed from your credit report after seven years. This is why it is important to check your credit report, to ensure that inaccurate information is removed and debts that have been settled are removed after seven years.

What Can I Do So That My Unpaid Child Support Does Not Affect My Credit?

It is important to make payments and continue making payments in order to hopefully avoid the unpaid support being sent to collections. A debt that is in collections has a much greater negative impact on your credit score, and can take a long time to increase your score once it has dropped due to an unpaid support debt that is in collections.

If you are having trouble making payments, you should contact your local child support enforcement agency, as they can help you come up with a plan for making payments. You could also ask for a court hearing to request a modification to your child support payments. If your circumstances have changed significantly since the support order was first put in place, the court may modify how much you are required to pay in support.

Additionally, if you think that the information that was reported to the credit bureau is incorrect and you do not owe unpaid child support, you could contest the credit report. You should always contest information on your credit report in writing by sending a credit dispute letter to the credit bureaus.

Do I Need A Lawyer For Help With Unpaid Child Support?

If you are experiencing issues associated with unpaid child support, a child support attorney can help you communicate with the child support enforcement agency. An experienced attorney can advise you on the best course of action to manage your unpaid support debt, as well as minimize the damage to your credit. Additionally, they will also be able to represent you in court, as needed.

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