Summary: Did you neglect to pay an rental debt from years ago? Find out if you should pay off an old apartment debt and how to fix your situation.
Statistics show that 5.7 million households in the US have rent arrears. If that's what you're experiencing at the moment, how you plan to deal with this debt will influence your credit report, even though rent payments are generally not reported to the credit bureaus. Here are some of the best ways to handle an old apartment debt to avoid damaging your credit.
Terminating an apartment lease early
Terminating a lease has its consequences, and it's also one of the hardest decisions to make. For example, you may be running behind on your rent while dealing with many other financial issues. Or maybe you may need to move to a new city for important reasons such as work. Whatever the reason, you may end up accumulating debts in rent arrears.
Ideally, breaking your lease won't reflect on your credit report, but it can still affect your credit scores. Here's what you need to know before deciding to terminate your lease.
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What's on your apartment lease agreement?
Your lease may have a provision for what you need to do when you want an early termination. In addition, it may include guidelines on the termination procedure and the fees you'll need to pay.
For example, your lease agreement may require you to give up your security deposit or pay an amount equivalent to two months' rent and additional termination fees.
If the lease agreement has no such provisions, the laws of the state will be applied. Although these laws vary from one state to another, most states allow landlords to find a new tenant to replace you as soon as you issue a notice.
If the landlord fails to get a tenant, you may be required to continue paying the rent for the remaining lease period or until a replacement is found.
That's often the beginning of old apartment debts that can lead to the following problems if left unpaid:
- You may face a debt collection lawsuit from your landlord resulting in wage garnishment.
- Your landlord may hand over the debt to a collection agency that may file a lawsuit against you.
- Future landlords may not allow you to rent their property if they find out about your rental history.
Suppose you've been sued for an old apartment debt. In that case, you can use SoloSuit to file a response in three easy steps. The software helps you draft the best answer for your lawsuit and have it delivered to the right parties as per your state's legal requirements.
Use SoloSuit to respond to debt collectors fast and win in court.
How an old apartment debt can affect your credit score
Breaking a lease may not impact your credit, but the debts that come with it could. If your landlord hands over your arrears to debt collectors, it'll be treated like any other debt in your account. Once you fail to pay the debt and the collectors report it to the credit bureaus, your credit score will be significantly affected.
A collection account stays in your credit report for seven years from the date you first miss your payment. As long as the debt remains unpaid, the collection account will continue to affect your credit score. Once the debt is cleared and the collection company informs the credit bureau about it, the account will be marked as paid. However, it may remain in the report until after the seven years but with a lesser impact on your credit score.
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How to settle your apartment debt
The sooner you settle your apartment debt, the easier it will be for you. You don't want to wait until a collection agency reports your debt to the credit bureaus to do something about it. Here are ways to settle your old apartment debt:
- Talk to your landlord and negotiate a debt settlement arrangement.
- If the debt is already with a collection company, try negotiating a repayment plan.
- Respond to the debt collection lawsuit. If you have difficulties responding to the suit, use the SoloSuit app to generate an answer, which an experienced attorney will also review before delivering it to the appropriate parties.
When served with a debt collection lawsuit, you'll need to respond to it within the timeframe provided by the law. The Solosuit App is a step-by-step answer-generating app that asks questions about your lawsuit. Then, the response will be generated depending on the information you feed into the app.
An experienced attorney from SoloSuit will then review the answer and have it sent to court. A copy of the answer will also be sent to the plaintiff on your behalf. That way, you save a lot of time, money, and resources needed to respond to a lawsuit.
The simple answer to whether you should pay your old apartment debt is: Yes!. Like any other debt, your credit score can be affected by apartment arrears, which could also ruin your chances of ever renting a property in the future.
What is SoloSuit?
SoloSuit makes it easy to respond to a debt collection lawsuit.
How it works: SoloSuit is a step-by-step web-app that asks you all the necessary questions to complete your answer. Upon completion, you can either print the completed forms and mail in the hard copies to the courts or you can pay SoloSuit to file it for you and to have an attorney review the document.
Respond with SoloSuit
"First time getting sued by a debt collector and I was searching all over YouTube and ran across SoloSuit, so I decided to buy their services with their attorney reviewed documentation which cost extra but it was well worth it! SoloSuit sent the documentation to the parties and to the court which saved me time from having to go to court and in a few weeks the case got dismissed!" – James
>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate
>>Read the NPR story on SoloSuit: A Student Solution To Give Utah Debtors A Fighting Chance
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