![]() Every single one of these autopay agreements is predicated on the notion that you will have funds available in your bank account to send out when the bills are due. Simply signing up for autopay doesn’t guarantee your bills are always going to be paid on time. Also, they are not across-the-board improvements to all three of the credit bureaus – only Experian offers them for now. These new programs are still adding new banks, credit unions and creditor names to their approved lists, so not every payment or account may show up. You must be willing to share your bank account information to sign up for either of these programs, but you can opt out at any time. These programs are a step in the right direction for someone with a thin credit file. It’s a relatively new program that also uses your bank account information but rather than checking for payments, it looks for good money management and savings habits. As the name implies, this is a program from FICO, the credit scoring giant. While not tied directly to automatic payments, Experian Boost uses your bank account data to identify utility and phone bills (two types of accounts that are not typically reported to credit bureaus) that you pay on time through a demand deposit account such as a checking or savings account. This is where two new programs in the credit scoring arena may help to boost your score. But if you can add more data to your credit report to be measured, the scoring impact of on-time payments goes up and can become a beautiful thing – at least from a credit scoring point of view. If you have a thin credit file or are new to credit, a strong payment history based on very little data is a good thing. New ways your bill payments can help your credit score So, if you are never late because of automatic payments arriving when they are due, then the payment history piece of your score will always be in tip-top shape. Accounting for 35% of your score, payment history leads all five scoring categories with amounts owed coming in second at 30%, followed by length of credit history at 15%, and credit mix and new credit accounting for 10% each. Paying bills on time is the biggest factor making up your FICO score. What counts is what you do, not how you do it. And, of course, the likelihood of getting all your payments delivered to the creditor on time is increased by arranging automatic payments that arrive, or at least are posted, before the due date. But unfortunately, from a traditional credit reporting and scoring point of view, automatic payments don’t count for any more than sending in a payment via snail mail, as long as it arrives on time. The fact that utility companies do indeed reward their customers if they sign up for autopay might be reason enough to go the autopay route. But it’s a bit more complicated that that. Your bills will get paid on time and some utility companies even give a discount if you pay this way. So, you might be wondering if your score is impacted when you make automatic debits from your credit card or bank account. ![]() It seems like there is a never-ending list of things that can affect your credit score.
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