Q and A: Can a traffic ticket affect my FICO score?
The quick answer is yes. Even though your driving record has nothing to do with your credit worthiness a traffic ticket can negatively affect your credit and your credit score.
Here is the question that came into me from Brian:
A few years ago I was on a summer vacation and driving through the United States. I got pulled over for speeding and got a ticket. Even though we were going through the state, I did not have to pay immediately, receiving a citation. After coming back to my home state of Arizona, I threw the ticket away knowing I would never go through that state again.
Now I get a letter from that county for the speeding ticket, saying they are going to hire a collection agency to collect on that ticket. Can I get dinged because of this? What do traffic tickets and credit have to do with each other?
The answer, as stated above, is yes, they can hire a collection agency to collect on this ticket. While traffic citations aren’t reported to credit reporting agencies, accounts in collection are often reported to bureaus, in some jurisdictions. Many people ignore the traffic citations, and cities and counties are sending their bad, uncollected debts to collection agencies to collect on this unpaid revenue. My answer would be to pay this ticket before it does go to collections.
You are right in that a traffic ticket has nothing to do with credit, but anybody and everybody is using this method to collect on unpaid revenue, even though it has nothing to do with credit. And it is legal. Believe it or not, I have even heard of libraries turning in overdue fines to debt collectors to collect.
If a debt is turned over to a collection agency and that collection agency goes through the proper and legal options available to them, yes, they can put it on your credit report. When they do, this can severely affect your FICO scores.
How bad can damages get? Debtors with a high FICO score could experience nearly 100 point declines. Then you apply for a credit card or a home loan and you are rejected because your score is too low.
“Credit so Clean, people want to steal it”