How Does Reporting or Collections Affect the Tenant’s Credit Score?
Reporting rental debt to the Credit Bureaus can have a negative impact on the Tenants credit.
According to the Financial Consumer Agency of Canada, once your creditor transfers your debt to a collection agency, your credit score will likely go down.
When rental debt is reported to the Credit Bureaus:
- Credit scores typically decrease when a debt is reported to the Credit Bureaus
- Lenders, insurers, Landlords, and even some employers may refuse applications or increase rates when a collection appears on a credit report
- Debt remains on the credit file until paid, or until the legal/statute of limitations expires