How To Avoid Unpaid Child Support From Appearing On Credit Reports
|Friday, 10 August 2012 00:00|
By Jennifer M. Paine
Federal law allows the state child support agency to report a delinquent child support payer who is just $1,000, and sometimes less, behind!
This report will appear on - and negatively impact - your credit report.
To avoid credit reporting if you are headed toward the threshold, you should consider these four options:
1. Review and Modification
If your income is reduced, request a review or modification of child support as soon as possible.
A "review" refers to an administrative adjustment of the support order without a hearing to determine whether there is a sufficient change in circumstances to warrant a support modification. For most states participating in the Title IV-D federal program, a parent may request this review once every three years.
A "modification" refers to a change following a hearing at which you present evidence of a sufficient change and how the support obligation should also change. Be cautious, however, because the other parent’s income may have also changed – and you could end up owing more support.
You should make your request as soon as practicable because, in most states, you can only "back date" your support obligation and erase arrearages, absent the other parent’s agreement, to the date you filed your request.
2. (Correct) Direct Pay
Do not pay child support directly unless your support order allows you to do so. Divorce attorneys cannot overstate this rule.
In most states, any direct payments are conclusively treated as gifts, and you will still owe the support you paid directly. Even if you have proof of payment, and in many states even if the other parent acknowledges receiving the payment, you will still be treated as behind in the eyes of the state.
For states that do collect receipts, you can expect to take a long time at the courthouse or the support agency to correct your account. That being said, if you and the other parent can get along, or if you can arrange for automatic deposits from your pay, you might consider revising your order to allow for direct payments.
In many states, you pay an administrative fee to make payments through the state, and you can save yourself money by making them directly.
Related Article:How To Pay Child Support Directly
3.Nunc Pro Tunc Orders
If you notice a clerical error in your support order – for example, maybe the "2" in "$250 each month" became a "5" and thus the payment is $550 - contact the courthouse or support agency to request a nunc pro tunc order.
These are orders "from the beginning," and divorce lawyers use them to correct clerical errors so that the court’s order reflects the court’s and/or the parents’ intent at the time the order was issued.
Any mistakes made while the incorrect order was in existence are automatically corrected. This means, that extra $300 each month in our example that went unpaid is automatically erased from the first date support was due.
4. Arrears Discharge
If you have a forgiving ex-wife, ask her to forgive some of the arrearages owed to her. In many states, parents can forgive all or a portion of support owed them directly for their child, even if the state cannot forgive the support owed to the state as reimbursement for government benefits.
Some states are even suspending interest and penalty charges for parents who make good faith payments toward their support arrearages. It is worth looking into if your arrearage is insurmountable.
Whatever you do, don’t let yourself slip into a pattern of late payments. Your credit score will take a serious hit.
Jennifer M. Paine is a Michigan Divorce Lawyer with Cordell & Cordell. She is licensed to practice in Michigan, and has been admitted pro hac vice in Illinois, Ohio, and the United States Court of Federal Claims.
Ms. Paine received her BA in English and Mathematics from Albion College and graduated Summa Cum Laude. She received her Juris Doctorate from MSU College of Law and graduated Summa Cum Laude.