Home > Credit Score > Find Out Which Bills Affect Your Credit Score

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

A 2015 TransUnion survey asked consumers whether they believed a few common bills are regularly reported to the major credit reporting agencies. The data came from a survey of 1,001 US renters ages 18 to 64. The results of the study revealed that people often don’t understand which monthly bills can affect your credit score.

So out of these common bills, what happens if you don’t pay them?

  • Rent payments
  • Utility bills
  • Cable and internet bills
  • Cellphone bills
  • Insurance payments
  • Car payments
  • Mortgage payments
  • Student loan payments

Do Rent Payments Affect Your Credit Score?

If you thought paying your rent bill on time helped your credit standing, you’re not alone—48% of those who responded to TransUnion Interactive’s online survey said they thought rent payments got reported to credit bureaus.

Generally, rent collectors don’t report payments to credit bureaus, so you don’t get “good credit” for making those payments on time. Still, neglecting to pay rent several times might end up hurting your credit because the company you owe money to may send the bill to a debt collector.

So paying rent on time may not put you on a sure path to a high credit score, but you should still make it a priority to avoid late fees and debt collector trouble. Plus, landlords often check your credit before agreeing to accept you as a renter, so you should avoid letting late rent bills go to collections.

Do Utility Bills Affect Your Credit Score?

Of the TransUnion respondents, 54% thought their utility payments are reported, which indicates another misunderstanding. Like rent payments, credit bureaus do not receive information about power, cable, and other utility bills—unless you forgo paying altogether and the bills wind up with debt collectors.

Stay current with your utility bills to keep your home in good working condition, but don’t expect it to make much of an impact on your credit score.

Do Cable and Internet Bills Affect Your Credit Score?

More than half of those surveyed thought cable and internet payments show up for the credit bureaus to see. Once again, that’s not true. Only those bills that remain unpaid and are sent to collections will ding your credit.

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

Do Cellphone Bills Affect Your Credit Score?

Turns out, credit bureaus do not have a record of your cellphone payments, although 52% thought that was the case. You may experience phone service shutoffs if you don’t pay your bill every month, but missing payments won’t affect your credit score. That is, unless you leave them unpaid for a long time.

Do Insurance Payments Affect Your Credit Score?

Most adults have to pay auto insurance payments every month, and many also pay out of pocket for health insurance. Although many insurance payments are high, these bills aren’t regularly reported to credit bureaus either. Insurance companies may charge fees or higher rates if you neglect to pay on time, however.

Do Car Payments Affect Your Credit Score?

If monthly bills like rent, utility, and cellphone bills aren’t regularly reported to the credit bureaus, which bills do show up? One type of bill that can affect your credit score is any payment you make to auto lenders.

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

Do Mortgage Payments Affect Your Credit score?

Even though the TransUnion respondents were renting their homes, it’s surprising that only 29% knew mortgage payments wind up with credit bureaus—and as a result, these payments have a significant impact on credit scores.

Like banks that offer auto loans, mortgage lenders track your monthly payments and send information about late bills to credit reporting agencies. Any late payments will negatively impact your credit scores. If you don’t make mortgage payments for several months, you risk foreclosure, which has lasting effects to your credit.

Do Student Loan Payments Affect Your Credit Score?

The last monthly bill on this list, student loans can affect your credit score too. Student loan lenders report each monthly payment to credit bureaus and whether it was paid on time. The upside: Staying up-to-date on your student loan payments can help you build credit and improve your scores.

The Bottom Line: Many Monthly Bills Do Affect Your Credit Score

Plenty of regular bill payments are regularly reported to the major credit bureaus. Any time a bank or lender extends you a loan or line of 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 credit payment hurts more than another—a mortgage payment that’s more than 30 days past due is just as bad for your credit score as a credit card bill that’s 30-plus days late. (But if your mortgage goes unpaid for a long time, prepare for much bigger headaches.)

If you fail to pay any bill—including those that aren’t regularly reported to credit bureaus—your credit score may be jeopardized. Collection accounts have a negative impact on your credit standing for a long time. Even after you pay the debt, your credit will continue to suffer for months or even years.

However, the damage from collection accounts may be short-lived if the incident is an outlier on your credit report. Making on-time cellphone or utility bill payments won’t directly improve your credit standing, but you should still do the right thing and pay these bills to avoid further trouble.

If you’re looking to improve your credit, you have plenty of strategies to consider. First, it’s a good idea to track your progress by getting your free credit report card on Credit.com. You’ll get a personalized snapshot of your current credit situation so you can see if anything, including a late payment, has affected your scores.

What Else Should You Know about Credit Scores?

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  • Eddie J

    Sadly and unfairly, most utility companies are big campaign donors and
    lobbyists to politicians who refuse to have laws changed. Utility
    companies in particular, make millions on late fees,
    disconnect/reconnect fees and other anti-consumer fees and want to keep
    it that way. Best bet is to strongly and consistently lobby your state
    and federal representatives to stop pandering to this crap for the sake
    of political expediency.

  • Christine DiGangi

    A lot of people feel that way, and companies generating scoring models have given it some serious consideration. It’ll be interesting to see if such payments are included going forward, given the strong opinions on it. thanks for sharing.

  • http://www.credit.com/ Credit.com Credit Experts

    The biggest single factor is payment history — whether you have paid on time. Here’s how to get your free credit score, along with a personalized guide to how you stack up on the factors determining credit score.

  • http://www.credit.com/ Credit.com Credit Experts

    You’re right — for a creditor to be on your credit report, the creditor must report the account. (That’s why some things may not appear on all your credit reports.)

  • Erick Arwa

    Let me ask, Considering the amounts owed, new credit, credit profile, payment history, type of credit etc, what formula do we use to finally arrive at the credit score?

    • http://www.Credit.com/ Gerri Detweiler

      The exact formula is the credit scoring company’s secret sauce!

  • Kenneth Rome

    I pay my water bill in 8 monthly installments ( the first 8 months of the bill year) So after the first payment I do not owe anything but am in front in payment, increasing each month. Why should this bill be called a debt and affect my credit rating? Do the water company pay their bills before they receive services or goods. Do they pay out wages before they have been earned?

  • Krisstoferg

    ive been paying all my bills on time for years and thinking i was making my credit better but i guess i was right the first time saying get what you can for free and screw the companies since in order for me to have anything besides POOR credit, i’d have to spend tons of money taking loans that i dont need and theres no space for DISABLED in the employment section either so what if i have to pay cash for the crap cars i can afford i’ll save a ton of money not paying for the other crap

  • tedmingo

    The sad part is you cannot report your tenant to the credit scorekeepers when they fail to pay their rent on time.

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