How does one go about reporting your on-time payments with the utility company to the credit bureau to establish your credit history? Is there a company that does that for you? Or does the bank take the responsibility in reporting your credit history to the credit bureau? I have been trying to find the correct answer and who to contact to establish my credit history with the credit bureaus. I have the verification letters from my utility companies all stating that I have never been late with my payments and have paid on time every month. Any help would be much appreciated.
Unfortunately, you are probably out of luck when it comes to getting your utility bills included in your credit reports. The credit reporting system is a voluntary system. No lender or service provider is required to report information. In the case of utility companies, they typically do not report monthly activity. If you were to fall behind, however, and your balance was sent to collections, the collection account would likely appear on your credit reports.
The problem with getting information added to your credit reports is that the credit reporting agencies (CRAs) must carefully check out companies before they report, to make sure that those companies follow specific procedures, as well as state and federal laws that govern disputes, among other things. It’s just not cost effective or efficient for the CRAs to add information about a single customer.
Your best bet is to focus on building credit through companies that already report to the CRAs. If you don’t already have a major credit card, your next step could be to get a secured credit card. You’ll put a deposit in an account with the issuer—much like you would if you rented an apartment—and you’ll get a major credit card you can use just like any other.
Make sure you pay your bills on time each month. It’s perfectly fine to pay in full to avoid interest charges. Once you’ve paid your secured card on time for at least six months, you may have success getting a retail credit card, and from there, you should be on your way.
[Resource: Get your free Credit Report Card]
Image: Tyler Magnuson, via Flickr.com