Utility bills are a part of everyday life, but did you know they can also impact your credit score? While utility companies typically don’t report your payment history to the credit bureaus, there are ways to ensure your on-time payments can boost your credit score. In this article, we’ll explore how utility bills can affect your credit and how you can use this information to your advantage. And remember, for any mortgage service needs, O1ne Mortgage is here to help. Call us at 213-732-3074.

Are Utility Bills Reported to the Credit Bureaus?

Generally, utility companies do not share your payment history with the major credit bureaus—Experian, TransUnion, and Equifax. This means that your credit reports won’t automatically include this information. However, there are services like Experian Boost® that can help integrate your utility bill payments into your credit score.

How Paying Utility Bills Can Boost Your Credit

Experian Boost is a free feature that scans your credit card and bank account histories for on-time utility bill payments. If it finds eligible payments, it adds them to your Experian credit report, which can improve your FICO® Score. This service only adds on-time payments, so late payments won’t negatively affect your score.

To set up an Experian Boost account:

• Sign up for Experian Boost for free on Experian’s website.
• Provide your personal details like name, date of birth, and email.
• Connect your credit card and/or bank accounts that you use to pay your bills.
• Verify the payments Experian Boost finds, and choose whether to add them to your credit file.
• Check whether your FICO® Score has increased. For many users, this happens immediately. On average, Experian Boost users who saw an increase saw their FICO® Score 8 from Experian increase by 13 points.

What Utility Bills Qualify for Experian Boost?

The following utility bills are eligible for Experian Boost:

• Mobile and landline phone
• Internet
• Cable and satellite
• Gas and electricity
• Video streaming services
• Water
• Power and solar
• Trash

Rent payments can also be included, as long as you’ve made at least three payments within six months, with one payment occurring in the last three months.

Will Lenders Use My Experian Credit Score?

There’s no way to know which score a lender will use to determine whether to work with you. Since Experian Boost does not affect your credit files with Equifax and TransUnion, it’s certain that if a lender uses a score based on data from those credit reporting agencies, your utility bill payments won’t factor into the score they see.

Can Utility Bills Hurt My Credit?

Utility companies can send unpaid bills to collection agencies. This won’t happen when one payment is slightly late; rather, if you miss multiple payments or leave a bill unpaid for months, the provider may hire a separate company to collect the debt. When you don’t pay a bill for six months or more, the provider may charge off the account instead, assuming you’re not going to pay. Both a charge-off and an account in collections will stay on your credit report for seven years and hurt your credit score.

Additionally, the National Consumer Telecom & Utilities Exchange (NCTUE) is a specialty consumer reporting agency that collects and shares customer data, including payment history, among its 95 utility and telecommunications company members. Say you have an unpaid balance with a natural gas provider. If it’s a member of the exchange, it may share that information with other providers, which can affect whether another natural gas utility decides to do business with you—or require you to pay a deposit to do so.

The Bottom Line

Utility payments are a fact of life, but it’s possible to put them to good use. Using Experian Boost can lead to a quick uptick in your Experian credit scores if you have enough on-time payments to include in your credit report. You also have the opportunity to save money on utility payments by using Experian’s BillFixer tool, which will negotiate with your utility providers to lower your monthly bills.

For any mortgage service needs, O1ne Mortgage is here to help. Our team of experts is ready to assist you in finding the best mortgage solutions tailored to your needs. Call us today at 213-732-3074 and let us help you achieve your homeownership dreams.