January 18, 2019


Negative credit report could have lasting impact on housing, employment & loans

Washington, D.C. – In a letter to Equifax, Experian and TransUnion, Congressman Joe Kennedy III asked the nation’s three largest credit agencies to ensure the shutdown does not result in lower credit scores for federal employees who have not been paid on time. With the government shutdown entering its fourth week, nearly a million federal employees face negative credit reports for missed payments on mortgages, rent, car loans, and student loans.

“For working families, the pain of even one missed paycheck reverberates far beyond just the immediate impact of struggling to meet basic needs,” wrote Congressman Kennedy. “What starts as a fight to cover daily expenses like food and transportation quickly evolves into missed mortgage, car, medical and student loan payments — all of which come with serious consequences. Among them: a crippled credit score that can hang over individuals and families for years. Under the Fair Credit Reporting Act, the Dodd-Frank Act and additional existing laws, poor credit can be used to deny employment, deny housing, deny a business loan, deny a mortgage application, and, critically for federal employees, deny a security clearance. More than that, it can be used to increase interest rates on future credit cards and personal loans, creating a cycle of bad credit that cannot be broken simply by working harder and spending smarter.

He continued, “This week, President Donald J. Trump signed bipartisan legislation guaranteeing back pay to all federal employees once the shutdown has ended. However, it is not certain when those paychecks will arrive and it is not guaranteed a paycheck will ever arrive for the roughly one million contract workers unemployed during the shutdown. With that in mind, I urge you to take any steps possible to coordinate with lenders and borrowers, alike, to modify the terms of existing loans, to allow for hardship deferments, and to keep the shutdown from resulting in lower credit scores for families who find themselves in this precarious position because of the inaction of their government.”

To read Kennedy’s full letter, please click here.


For Immediate Release:
January 18, 2019 

Dan Black (202) 225-5931