How will an auto accident impact my credit score?

Does an Accident Hurt Your Credit Score?

Good news — being involved in a car accident does not automatically affect your credit score. Whether you’re at fault or not, your credit report won’t reflect the accident itself. That said, several indirect consequences of an accident can damage your credit if you’re not careful.

Total Loss Vehicles and Loan Trouble

If your vehicle is declared a total loss and you owe more on your car loan than your insurer pays out, you’ll be responsible for the difference. Without gap insurance, that remaining balance is your responsibility. Failing to pay it — or missing car payments while waiting on a claim — can lead to late fees, collections, and credit score drops.

Medical Bills in Legal Limbo

While medical debt currently doesn’t appear on credit reports due to recent rule changes, that policy is in flux. A recent Florida court decision could open the door for unpaid medical bills to once again hurt your credit. Fortunately, if you’re represented by a personal injury attorney, they can often work with providers to delay collections until your case resolves.

Pay Your Bills, Even If the Car Is Gone

If your car is in the shop or totaled, make your payments anyway. Lenders don’t track your accident status and will expect on-time payments regardless. Don’t assume the accident puts your loan on pause — it doesn’t. Staying current on your car note is critical to protecting your credit.

Be Proactive With Insurance Coverage

In rare cases, being underinsured or uninsured in an accident you cause could lead to a lawsuit, a judgment, and eventually a credit hit. The best protection? Make sure your Maryland auto policy is properly set up today. Bowers Law offers free insurance policy reviews to help ensure you’re not financially vulnerable in a future crash.

How Will an Auto Accident Impact My Credit Score?

If you’re unsure how your accident or insurance situation may affect your finances, the team at Bowers Law can help. We offer free consultations and insurance reviews for Maryland drivers. Call us at (410) 885-6200 to learn more.