Being incarcerated in the United States prison system is a worst-case scenario for millions accused of crimes across the country, including Utah. The ramifications of a lengthy sentence aren’t just emotional and physical — there are financial implications to consider as well. Damage done to earning power for inmates who serve their time can make it impossible to recover fully and reintegrate into the community. Our Salt Lake City Criminal defense attorneys open a small window into the challenges these men and women face. Read on to learn more about how criminal convictions can damage your credit score in Utah. You can reach out to the legal team at Overson Law, PLLC for help.
Does a Prison Term Show Up in My Credit Report in Utah?
A prison term may have negative implications for your credit score, but it will not actually appear on a credit report. Your credit score is not directly impacted by your incarceration. Instead, your incarceration will create problematic financial situations that may lead to a lower credit score over time. While you wait in prison, you might continue to rack up bill payments that are all going unpaid. The longer you are in prison and the more unpaid bills you accumulate, the worse off your credit score will be when you are released.
The idea of managing your finances is probably the furthest thing from your mind if you have recently been sentenced to prison. However, existing bills are not put on hold even if you are unable to pay them from a prison cell.
How Does Prison Time Damage Your Credit Rating in Utah?
Serving a prison term does not directly damage your credit score. It is not something that appears on a credit report. Things like arrests, criminal charges, and convictions are not used to calculate your credit score. However, civil actions against you might appear on your credit score. It is crucial to have someone helping you handle your finances from outside of prison if you want to avoid a plummeting credit score. Hiring a Riverton City criminal defense lawyer to help you is an excellent place to start.
Credit Card Payments
Even if you’re behind bars for just 12 months, the harm done to your credit rating could take a decade or more to dig out from completely. Bills, including credit cards and auto loans, go unpaid while you’re sitting in a cell unable to work and continue to accumulate interest along with compounding fees. If you do not have anybody on the outside who can help you cover your bills until you are released, you are looking at possibly years of late, unpaid bills. Notices might show up in your mail at the jailhouse indicating seizures of property and foreclosure. Declaring bankruptcy when you’re released from prison might be the only way to avoid wage garnishments and liens.
In addition, credit card companies might cancel your credit cards if they find out you are incarcerated. While this means you will not have any late bills to worry about, cancelation of credit card will negatively impact your credit score.
Your best option is to contact any credit holder to whom you still owe payments and explain your situation. You should try to pay off and close as many credit accounts as possible. Credit holders may also agree to place you on a payment plan or otherwise work with you to help you avoid things like foreclosures, property seizures, and a spiraling credit score.
Loans and Mortgages
While incarcerated, you obviously will not be working and earning a normal income. Even if you have someone on the outside to help you pay your bills or you are working while incarcerated, that money can quickly run out. Having no livable earnings while in prison often leaves people with debt they can no longer afford to pay off. This could be debt from purchasing a home, credit cards, and student loans. People with debt they cannot afford to pay may find themselves selling off their possessions just to pay the bills. This can also lead to foreclosures on homes, bankruptcy, and defaulting on loans and lines of credit. Foreclosures and defaults will all cause your credit score to plummet. Declaring bankruptcy once you are released from prison will only make it harder to rebuild your credit score.
Deferring Your Bills and Payment in Utah
One way to try to avoid financial strain while incarcerated is to contact any credit card companies or other people you may owe money to and ask about having your payments deferred. It is possible that you can put your credit accounts on hold, so to speak, while you are in prison. This way you won’t have any unpaid bills and your credit score will not take a nosedive. If deferment is not an option, you may be able to work out a reduced payment plan that is easier to keep up with.
How the Loss of Professional Licenses or Credentials Can Impact Your Credit Score in Utah
A criminal conviction large or small — from a DUI to a drug-related charge — can cause professional licensing organizations to strip you of your credentials, effectively ending your chosen career. One second you’re a surgeon with privileges in Utah’s finest hospitals, and the next you can’t get work in a soup kitchen. This action often results in diminished earning potential over your entire life, unless you find an employer willing to take a chance on you and look past your criminal record. For many, that act of kindness never happens, and they toil away in low-earning positions unable to provide for their families as effectively as those without strikes against them.
People who lose their professional license may find themselves starting over in new careers. It can be difficult to find work when the only thing you are qualified to do is no longer available to you. Crippling debt, bankruptcy, and poor job prospects create a perfect storm of bad credit that leads many into poverty. Finding a good West Valley City criminal defense lawyer who can help you manage your finances while you serve your prison term can greatly reduce the damage taken by your credit score.
How Increases in Insurance Premiums after a Conviction in Utah Can Affect Your Credit
If you receive a conviction for a traffic-related offense, including driving under the influence, say goodbye to your affordable insurance premiums. Insurers will jack your auto coverage through the roof because of your perceived risk making it almost impossible to find affordable insurance. Add in your already lower earning power because of your conviction and driving a car with any semblance of coverage becomes an impossibility. The added cost to drive doesn’t even factor in the mandatory minimum 18-month license suspension in Utah. Even if you somehow find a job, it better be within walking distance. The dominoes just continue falling making it harder and harder to become a member of the community you’re supposed to belong to. Does this sound like rehabilitation?
Disadvantages of Having a Poor Credit Score in Utah after Criminal Charges
A poor credit score can act as a barrier in a number of different financial situations. Any major purchases, such as a home or a car, will most likely require a credit check. The odds of securing a loan from the bank to make your purchase go down the lower your credit score is. Not only that, but even renting an apartment becomes difficult if you have poor credit.
People with poor credit are often unable to secure the finances they need on their own. Most often, they will need a co-signer, or someone to sign for a loan with them. Even still, some people may be distrustful of someone with such low credit and refuse to help you even if you get a co-signer.
The Importance of Relentless Criminal Defense Can’t Be Understated
When you’re charged with a crime in Utah or any other state, your life is quite literally on the line. Everything you’ve worked for could be gone in a hazy moment, and you might not ever get it back. Having an experienced Utah criminal defense lawyer by your side to look out for your rights has never been more important.
If you or someone close to you is facing indictment or charges related to a serious criminal offense, including DUI or drug-related issues, contact Overson Law, PLLC today to get help. Call (801) 758-2287 to schedule a free legal consultation regarding your case. I’ll come to you day or night.