How Does an Eviction Affect Your Credit Scores?
How might the eviction process affect your credit history? Our new video explores this question. [Duration - 1:20]
Reading time: 3 minutes
When lockdowns due to the Coronavirus/Covid-19 pandemic first began, the U.S government, and many individual states passed eviction bans in order to protect struggling Americans who worried that layoffs could prevent them from paying rent. The CDC has since taken steps to establish a nationwide eviction ban through June of 2021. However, these measures aren't permanent and as the pandemic wears on and the end of these halts draws near, millions of Americans could find themselves suddenly at risk.
If you're worried about being evicted, you're likely wondering how the process could impact your credit scores.
Does an eviction show up on your credit reports?
The eviction itself won't show up on your credit reports. However, a landlord may choose to seek payment by selling your debt to a collection agency. If your unpaid debt goes to collection, it can remain on your credit report for seven years and may negatively impact your credit score.
Is there any aid available to help prevent evictions?
If you're struggling to pay rent and fear you might be evicted, consider asking your landlord for a modified payment plan. They may be willing to accept less monthly rent for a period of time in order to avoid going through the eviction process. Just be sure to get any agreement you reach in writing.
Your landlord may also consider simply letting you out of the lease. You should generally take advantage of any option your landlord offers that avoids eviction. Although evictions won't show up on your credit reports, future landlords will be able to see your rental history. Any past evictions can make it significantly harder for you to get approved for a lease in the future.
Again, note that eviction protections vary state by state, so check your local laws for more details regarding your specific situation.
There are also nonprofits that specialize in helping people who face eviction, such as the Legal Services Corporation, which has a web page on how to find a legal aid clinic near you. There may be other organizations in your area that can guide you through your options.
Legislation related to Covid-19 evictions is still subject to change as the pandemic progresses. For the most up-to-date information about the CDC eviction ban, refer to their website.