The COVID-19 pandemic has thrown everything out of whack, including credit reporting. Creditors have made unprecedented accommodations to help struggling debtors. As a result, you’ve had to shift the way you reported credit to ensure your clients and tenants aren’t adversely impacted. Datalinx has tried to keep you abreast of all the latest changes in credit reporting to ensure you have the most up-to-date reporting guidance.
Changes in eviction reporting codes
If you are a property owner or manager who reports evictions, you’ll want to pay attention to this latest advice from TransUnion:
Based on various state regulations and executive orders related to COVID-19, TransUnion is advising that you discontinue reporting Special Comment Codes QQ‐Eviction (non‐legal action) and RR‐Eviction until further notice. TransUnion has made the decision to remove accounts reported with these Special Comment Codes from our database. We will advise once you can resume reporting Special Comment Codes QQ‐Eviction (non‐legal action) & RR‐ Eviction.
As previously communicated, if a resident is confirmed to be affected by a natural or declared disaster and is not able to make payments, you should report the resident as Current (Rental/Lease Status = 11) with a Current Balance of $0 and Payment Amount Confirmed of $0. Subsequently, for any month that was impacted, you should report a “D” in the Rental History Profile to indicate that no Payment History was available for those months.
More eviction guidance
On September 4, 2020, the Centers for Disease Control and Prevention (CDC) issued a temporary eviction moratorium that extends through December 31, 2020. (You may remember that the CARES Act included an eviction moratorium, which expired on July 24, 2020.) The CDC’s goal is to prevent further spread of COVID-19 by evicted individuals and families, but nonetheless has a direct impact on creditors.
The CDC’s moratorium temporarily halts certain residential evictions for nonpayment of rent for those who qualify. Renters must declare (under penalty of perjury) that they:
- Have tried to obtain all available government assistance,
- Expect to meet certain maximum earnings guidelines,
- Are unable to pay full rent,
- Are trying to make partial payments,
- Would become homeless or need to move into a shared residence if evicted, and
- Still have to comply with other rental obligations.
Renters seeking protection under this moratorium are required to submit the declaration to their property owners/managers. After the moratorium expires on December 31, 2020, property owners may require payment in full. Failure to pay at that time could result in a legal eviction.
If you have questions about reporting evictions and eviction reporting codes to the credit bureaus, reach out to Datalinx. Our experts can help you navigate the complicated waters of COVID-19 credit reporting!