Find Out Which Bills Affect Your Credit Rating

Here’s the facts about your credit rating: Everything you don’t know can hurt it, and there’s some confusion about what can cause the pain.

A 2015 TransUnion survey asked consumers whether they thought that a few common bills are frequently reported to the major credit reporting agencies: Experion, Equifax and/or Transunion. The data came from a survey of 1,001 US renters ages 18 to 64. The outcomes of the analysis demonstrated that people often don’t know which monthly statements can affect your credit score.

So out of these commonly paid bills, what happens if you do not pay them?

If you believed paying your rent punctually helped your own credit standing, you’re not alone–48 percent of those who reacted to TransUnion Interactive’s online survey said they thought rent payments got reported to credit bureaus.

Ordinarily, rent collectors don’t report payments to credit bureaus, which means you probably don’t get “good credit” for making these payments on time. However, neglecting to pay your rent several times may wind up damaging your credit because the company that you owe money to may send the account to a debt collector.

So paying rent on time might not set you on a certain path to a high credit score, but you should still make it a priority to avoid late penalties and debt collector trouble. Additionally, landlords frequently check your credit before agreeing to accept you as a tenant, so you need to avoid letting late rent bills end up collections.

On the bright side, it is possible to report rental payments. Reporting on-time rental payments can improve your credit score by as much as 20-30 points. Ask your property manager or landlord if they report rental payments. Put them in touch with us. It’s affordable and beneficial to you and them.

Of the TransUnion respondents, 54% believed their utility payments are reported, which is another mistake. They’re not typically, but they can be. You could be getting credit for your on-time payments, ask us how!

Remain current with your utility bills to keep your home in good working condition, but do not expect it to make much of an impact, if any, on your credit score.

Over half of those surveyed believed cable and Internet payments show up to the credit bureaus to see. Once more, that is not correct. Only those invoices that remain outstanding and are sent to collections will probably ding your credit score.

Of course, when you want to keep watching or streaming your favorite TV shows and films or playing online games, pay your cable and internet bills on time.

Turns out, credit agencies don’t have a record of your phone payments, although 52% thought that was the situation. You may experience phone service shutoffs in case you do not pay your bill each month, but missing payments will not affect your credit score. In other words, unless you leave them outstanding for quite a long time.

Do Insurance Payments Affect Your Credit Rating?

Most adults have to pay car insurance payments each month, and several also pay out of pocket for health insurance coverage. Although many insurance payments are large, these bills are not often reported to credit agencies. Insurance firms may charge fees or higher rates if you neglect to pay on time, however.

Do Auto Payments Affect Your Credit Rating?

If monthly bills such as rent, utility, and mobile invoices aren’t regularly reported on the credit bureaus, which of your bills do appear? One type of bill that can affect your credit rating is any payment you make to auto lenders.

Once a bank extends you a lease or loan to get a vehicle, the bank will start reporting your obligations to credit bureaus. If you miss one payment by several days, you could see some damage to your credit score. What is more, having bad credit or no credit can make it hard to get approved to get a car loan in the first place.

Do Mortgage Payments Affect Your Credit Rating?

Even though the TransUnion respondents were renting their homes, it’s surprising that just 29% knew mortgage payments wind up with credit bureaus–and consequently, those payments have a considerable impact on credit scores.

Like banks that offer auto loans, mortgage creditors monitor your monthly payments and send details about late invoices to credit reporting bureaus. If you don’t make mortgage payments for several months, then you are at risk for foreclosure, which has lasting effects to your credit.

The last monthly bill in this list: student loans

Student loans can affect your credit score also. Student loan lenders report each monthly payment to credit bureaus and if it was paid punctually.

Lots of standard bill payments are often reported to the major credit bureaus. Any time a bank or lender extends you a loan or credit, the lender reports your account payment history. Credit card bills, student loan payments, mortgage payments, and auto loan payments all fit this description.

No one type of charge payment breaks greater than another–a mortgage payment that’s more than 30 days past due is equally as bad for the credit rating as a credit card bill that is 30-plus times late. (But in case your mortgage belongs unpaid for a long time, prepare for substantially larger headaches.)

In the event you are not able to pay any bill–including those which aren’t regularly reported to credit bureaus–your credit score might be jeopardized. Late accounts have a negative influence on your credit standing for a long time. Even once you pay the debt, your credit score will continue to suffer for weeks or even years.

On the other hand, the damage from collection accounts may be short-lived if the episode is an outlier in your credit report. Making on-time cellphone or utility bill payments will not directly improve your credit standing, but you need to still do the right thing and pay these accounts to avoid credit score trouble.

If you are trying to improve your credit, you’ve got plenty of strategies to consider. To begin with, it is a good idea to keep track of your progress by getting your free credit report card on Credit.com. You’ll find a personalized snapshot of your current credit situation so you can see if anything, including a late payment, has influenced your scores.

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