Speeding tickets put credit scores at risk

by Officials in Chevy Chase Village, Maryland, have begun cracking down on unpaid parking and speeding tickets after the number of uncollected fines from its speeding cameras exceeded $1 million, the Washington Post reports. The cameras generate thousands of tickets, many of which go unpaid because drivers either don't plan on returning to the area, are strapped for cash or are simply defiant and choose to ignore the fine. In order to rectify this, Chevy Chase Village issued a notice to residents that going forward, unpaid parking tickets will be handed over to debt collection agencies. If they continue to go unpaid, they can severely damage a person's consumer credit report. Barry Paperno, spokesman for credit service company Fair Isaac Corporation, notes that while the hit to a credit score from a parking ticket isn't equal to that of a foreclosure or bankruptcy, it could still be enough to significantly affect a mortgage or car loan application. "Someone with a 680 score could lose roughly 50 points from the addition of a collection of this nature," Paperno told the media outlet. "For someone with a 780 score - very, very good credit - the appearance of one of these collections could lower their score by as much as 105 to 125 points." Violators from the village will receive three warning letters before the payment refusal is sent to one of the three major credit score bureaus. Village manager Shana Davis-Cook notes that collection efforts have yielded a 20 percent success rate, and she hopes to raise that number to 30 percent in the future. The Post points out that increased technological installations - such as automatic cameras that capture red-light runners and speeders, as well as electronic metering systems for those who don't pay parking tickets - have greatly increased the amount of revenue hauled in by municipal treasuries. Washington, D.C., mailed out $43 million in speed camera violations during fiscal year 2010. In fiscal year 2011, the District has already obtained more than $36 million for those crimes. The city of Davenport, Illinois, has resorted to similar tactics, KWQC-TV reports. The Davenport Police Department sent out around 40,000 camera-based tickets in 2010, and has hired a collection agency to handle delinquencies. "It's not worth the hassle that you're going to have," Davenport police lieutenant Mike Venema told the news source. "Most people value their credit rating and would rather not be receiving calls from a debt collector."