Child Support Payments Can Impact Credit Rating

When Florida parents get divorced, one of them might have to pay child support. The obligor parent who makes these payments needs to be sure they are made in a timely manner, or it could have unexpected financial ramifications.

Child support debt totaled $113 billion in the United States in 2015. Parents with delinquent payments could find themselves facing financial consequences for not making payments or for making late payments. This is because delinquent payments are reported to credit bureaus by state agencies that collect child support. Missed payments could result in the parent paying higher interest rates on loans or even being denied loans. Just as missing payments could negatively affect a person's credit, making timely payments can positively affect credit.

In some states, parents pay child support to state agencies that transmit the money to the custodial parent, while other states allow the paying parent to give child support directly to the custodial parent. Agencies are more likely to report missed or delinquent payments to a credit bureau, sometimes within a short time after the missed payment, and the custodial spouse may be more lenient.

The payment delivery method should be worked out at the time of the divorce, but parents can always ask the court to approve a child support modification plan. If a parent wants to change the child support plan, they may need help from a family law attorney who may be able to advise them how to do this and prepare the necessary paperwork. The parent may need to prove that he or she underwent a job loss or another significant loss of income.