List of Partners vendors. We all know we're supposed to pay our bills on time and carry as little debt as possible—the two major factors that go into calculating our credit scores. Yet, there are other, smaller factors many people aren't aware of that can also have an impact on our scores.
Many people pay their mortgage, credit card, and utility bills with unflappable consistency, yet neglect smaller debts. They may feel these debts are less important or that they will just go away if ignored. But sometimes they won't. Municipalities were once known to report unpaid parking tickets and even library fines to credit bureaus , for example, although that practice has largely been curtailed. Still, other unpaid debts, however trivial they may seem, can weigh down your credit score. Your electricity or gas bill is not a loan, but failing to pay it can hurt your credit score.
While utility companies won't normally report a customer's payment history, they will report delinquent accounts much more quickly than other companies you may do business with. It can be tempting to sign up for new credit cards that offer an attractive bonus for your business. Banks may offer tens of thousands of points or airline miles, while retailers provide in-store discounts when you apply for their credit card.
A single application may have little effect, but too many in a short time period can lower your credit score. So limit your number of applications for credit, especially if you are getting ready to shop for a home, car, or student loan, where a strong credit score could be extra important. To allow consumers to shop around for the best rates on automobile, student, and home loans, FICO will not penalize people who have multiple credit inquiries in a short period of time.
Various FICO formulas discount multiple inquiries within either 14 or 45 days. Do you have a credit card for your business? If you are the primary account holder on the card, most banks will hold you personally responsible for any debts you rack up with it, as well as reporting your payment history to the credit bureaus.
Late payments or unpaid debts will affect your personal credit, so be sure to use any business cards as judiciously as your personal ones. Incorrect information in your credit history can hurt your score. People with common names, for example, frequently find other people's information in their file. In other cases, typos and clerical errors result in adverse information affecting your score.
This is one of the reasons consumers are encouraged to check their credit reports at least annually and dispute any mistakes they find. You can obtain free credit reports once a year from each of the three major credit bureaus through the official website, AnnualCreditReport. One of the best credit monitoring services could also be useful in this endeavor. Review your credit reports at least once a year to check for errors or missing accounts you'd like to see listed. Sometimes the problem isn't what's in your credit report but what's not in it.
Then work to maintain a positive payment history going forward. To get a better understanding of where your credit stands, order a free credit report. While a delinquent account can remain on your credit report for seven years, new positive credit activity can reduce its impact over time.
Want to instantly increase your credit score? Until now, those payments did not positively impact your score. This service is completely free and can boost your credit scores fast by using your own positive payment history. It can also help those with poor or limited credit situations. Other services such as credit repair may cost you up to thousands and only help remove inaccuracies from your credit report. Learn what it takes to achieve a good credit score.
The purpose of this question submission tool is to provide general education on credit reporting. The Ask Experian team cannot respond to each question individually. However, if your question is of interest to a wide audience of consumers, the Experian team may include it in a future post and may also share responses in its social media outreach. If you have a question, others likely have the same question, too. By sharing your questions and our answers, we can help others as well. Personal credit report disputes cannot be submitted through Ask Experian.
To dispute information in your personal credit report, simply follow the instructions provided with it. Your personal credit report includes appropriate contact information including a website address, toll-free telephone number and mailing address.
To submit a dispute online visit Experian's Dispute Center. If you have a current copy of your personal credit report, simply enter the report number where indicated, and follow the instructions provided. If you do not have a current personal report, Experian will provide a free copy when you submit the information requested. Additionally, you may obtain a free copy of your report once a week through April at AnnualCreditReport.
Some may not see improved scores or approval odds. Not all lenders use Experian credit files, and not all lenders use scores impacted by Experian Boost. Learn more. Editorial Policy: The information contained in Ask Experian is for educational purposes only and is not legal advice.
This record becomes your utility credit history. To ensure fairness, federal law prohibits utility and other companies from engaging in discriminatory practices. Specifically, under the Equal Credit Opportunity Act ECOA , these companies cannot discriminate against consumers on the basis of sex, marital status, race, national origin, religion, or age.
They also cannot discriminate against people who receive public assistance. Utility companies frequently require new customers to make a deposit or get a letter of guarantee from a person who agrees to pay the bill if the customer does not. Under the law, requiring only some customers to pay a deposit or get a letter of guarantee is offering them credit on less favorable terms.
If done on a discriminatory basis, it is illegal. The utility company generally can require you to make a deposit or obtain a letter of guarantee if you are a new customer and all new customers are required to pay a deposit, or if you have a bad utility credit history. What if your spouse had a bad utility credit history? Could that reflect on you? In some circumstances, it could.
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