We all know that monthly bills like rent, utilities, cell phone, etc. don’t show up on credit reports, unless the accounts go to collection for a lack of payment. While these monthly bills don’t necessarily affect your credit score, they can be affected by your credit score. Your credit score can actually alter your monthly payment on common bills. The CGS Team is sharing 4 bills affected by your credit. If you’re thinking your bad credit can’t affect your bills, think again!
4 Bills Affected by Your Credit…
#1 Rent
Did you know there is a credit check involved with leasing an apartment? Even though you aren’t actually purchasing the place, the landlord has the right to check your credit and approve or deny your application based on what they find. The Federal Trade Commission (FTC) gives landlords the right to use your credit history to determine eligibility and take action if they see any red flags. That action can include increasing your rent or denying your application.
#2 Auto Insurance
According to The Zebra’s State of Auto Insurance Report, there is a subtle correlation between credit and car insurance rates. On a national level, drivers with low credit scores may pay more than twice as much as those with good or excellent credit scores. Massachusetts, Hawaii and California have banned insurance providers from using credit scores to determine rates, but it’s still a common practice in most other states.
#3 Gas or Power Bill
While your credit score may not directly impact the monthly payment amount of your gas or power bill, it can impact you paying a deposit or not. If your credit score is on the low end, it’s common for gas and power companies to require an upfront deposit before services can begin. The deposit is usually returned when you cancel service, but can be used as a form of payment if you fail to make your required monthly payments.
#4 Homeowner’s Insurance
According to USA Today, “Insurance companies use credit-based insurance scores to determine what you’ll pay for homeowner’s insurance. These scores are industry-specific and aren’t exactly the same as your credit score, but they use the information in your credit report to determine your score. The same negative marks that bring down your credit score can impact your insurance score, and affect your payment.”
Related: How to Get One Month Ahead on Bills
The 4 bills above should give you even more reason to work towards a better credit score. If you have been struggling in the credit department, take a second to map out a plan of attack. Start by paying off any late or collection account items, then work to become debt-free. Your score will start to rise as you make more and more progress. It all starts with a budget, so don’t hesitate to set one up and get to work. Have you felt the wrath of a low credit score with any of the monthly bills above? Have any of your other bills been affected by your credit? Post a comment below to share your thoughts and experiences.
