Credit reports reflect Illinois child support delinquency

 Posted on July 18, 2014 in Child Support

Credit reports show how well people manage money. Lenders make decisions on credit extension and loans — in part, based upon an individual's credit score. A Wheaton consumer with a high credit score is likely to live up to the financial terms of a mortgage, credit card or car loan while a low credit score indicates a person is a risky bet.

Illinois lenders may dig a little deeper into a report and discover a non-custodial parent is behind on child support payments. Consumer credit analytics companies, like FICO and VantageScore, don't figure back-owed child support into a credit score. However, child support arrears will be visible on a credit report and affect debt-to-income ratios, which influence lender decisions.

Government and other child support agencies are required to supply delinquent child support payments details to credit reporting agencies, under the Social Security Act. A credit report from Equifax, TransUnion or Experian will show how much a parent owes in support. It's up to the consumer to make sure the report contains correct data.

According to the National Child Support Enforcement Association, state child support enforcement agencies must notify parents about the debt before passing on the information. Parents must be given a reasonable amount of time to respond when the total of overdue support is in dispute. The debt can remain on a credit report for seven years.

The seven-year clock resets every time a full child support payment goes unpaid. The time the clock starts ticking can change every month a parent misses a payment. Some states' laws allow child support debt to be cleared from credit reports seven years after other milestones, like the date a child reaches legal adulthood.

Attorneys can advise non-custodial parents who are unable to meet the payment spelled out in a child support order. Family courts can be petitioned for support modifications based on significant changes in financial circumstances.

Source: Credit.com, "How Some Divorced Parents Hurt Their Credit" Gerri Detweiler, Jul. 11, 2014