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Posted in Paying Your Bills
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blips24

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How does paying bills on time increase my credit score?
I keep hear how everyone says to pay your bills on time to raise your credit score. Does paying the bills on time really raise your credit score or just ding it? I see nothing on my credit report from the utility companies. Do you get credit for paying them on time? Or only credit cards and loans?

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If you don't pay your cell phone bill or internet providers; be assured you'll be reported and it will affect your credit negatively.  Utility companies don't report to credit agencies unless there's a problem.

Most credit card companies report to one or more of the credit bureaus; Equifax, Transunion, and Experian. Credit Karma does not show Experian.

Paying bills on time shows you're responsible.  Do you think a mortgage company, auto loan firm, or credit card company wants the hassle of dealing with someone who isn't going to pay them? Having a good credit score opens doors to better interest rates. Would you rather pay 2% on a car loan or 12%? That's the difference between excellent and bad credit.  Think about buying a house with a bad credit rating and a 20 year  mortgage loan. You could end up paying over $20,000 more in interest alone.

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