What Does Apartment Eviction Mean to Credit?

In the past, apartment evictions could make finding another dwelling difficult if not impossible and you would still owe the amount left on the lease, but in 2011 it can also affect your credit. Instead of reporting rental payment histories to the credit bureaus, landlords can do this much more cheaply by relaying rental payments through a consumer reporting agency. (ref 1)

Judgment

The national credit bureaus do not report rental histories, because landlords can rarely afford the added expense, regulation and administrative duties that comes with credit reporting. An eviction can only appear on a report as a judgment if the landlord initiates litigation to pursue back rent, according to Maxine Sweet of Experian. Judgments affect credit for seven years and are one of the more serious items that can show up on a credit report.

Experian Acquires RentBureau

Experian acquired the largest rental payment history database when it bought out RentBureau in 2010. Starting in 2011, Experian will incorporate positive rental data in the reports of borrowers. By 2012, Experian will include any type of information, such as missed payments and evictions. As of 2011 the other two major bureaus -- Equifax and TransUnion -- do not report rental payments unless the landlord subscribes to their report service, but the trend in the reporting industry is to add rental and utility payments as soon as possible.

Considerations

Even if the credit bureaus do not report your rental data and the landlord chooses not to pursue a judgment, the eviction can negatively affect your tenant screening report. Landlords often pull both a credit check and a specialty report from a consumer report agency that just lists renting information, such as past evictions. An eviction on one of these reports is likely to make the landlord think twice about renting to you.

Tip

Go to your landlord for help instead of breaking the apartment lease. In the case where one roommate leaves and both are responsible for the bill, the landlord could assist in finding a new roommate to help with bills. You and the landlord could try to work out some an arrangement to avoid an eviction, such as a payment plan or working off some of the rent by doing odd jobs around the complex.