A image of a past due utility bill

How Unpaid Utility Bills Can Haunt Your Credit

Milad Hassibi June 19, 2018

Utilities are essential to a comfortable life. However, as many of us know, things can change in a heartbeat. Sadly, unpaid utilities are one of the top reasons some Americans have a less than ideal credit score.

Although many of us never sit down and think about utility bills, they can have a devastating impact on your credit score if they are ignored.

When you pay off a credit card in full and on time, the card issuer will send a positive payment note to the 3 bureaus: Equifax, Experian, and TransUnion. These bureaus take the information provided by creditors and produce a credit report and score for each and every consumer in America.

However, utilities are different. Since many of them are state regulated and required to adhere toA electrical line with a blue sky and a past due electric bill certain charges and prices, utility companies rarely send positive payment history to the credit bureaus.

Usually, your utility payments will not appear on your credit score unless your account has been placed into collections or your debt has been written off as a loss.

Unfortunately, most consumers have no choice when it comes to utility providers due to the heavy regulations behind the industry. Thankfully, most Americans understand that utilities are much more important to pay for rather than cable or a cell phone bill.

If your utility account gets placed into collections, you may see your credit score drop anywhere from 50 to up to 100 points depending on your current score and history.

If you are in collections for unpaid utilities, you can fix it. First, attempt to save up for at least 1 months worth of expenses. After you have collected the funds, you can begin to repay your debts or settle. Settling your debt can be hard and tricky since there is a wide array of legal matters that would need to be addressed.

If your debt has been sold to a collection agency, you can contact the debt collector and agree to pay a partial amount in exchange for having the negative entry removed off your credit report and score. To view your free annual credit report, simply go to www.annualcreditreport.com to get your latest credit report.

Final Note

If you are buried under a mountain of debt and ready for a fresh start, CrediReady can help. Our nationwide network of trusted and experienced lawyers are prepared to give you a FREE bankruptcy consultation to help you. Take a moment to fill out our inquiry form today to speak with your FREE attorney.

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