Credit Sesame explores things you may not have thought of that can affect your credit.
Your credit score is a three-digit number used by lenders to assess your creditworthiness. It influences everything from loan approvals and interest rates to apartment rentals and even job opportunities. Factors like payment history and credit utilization ratio are widely known to affect your score, but many other surprising things can influence it. From unpaid library fines to parking tickets, even seemingly minor financial obligations can leave a mark on your credit report.
- Subscription services. Many subscription services (e.g., streaming platforms and gym memberships with recurring payments) can be reported to credit bureaus if they go unpaid. Keep track of these and cancel unused subscriptions to avoid negative impacts.
- Car rental fees. Unpaid car rental fees can be reported to credit bureaus and impact your score.
- Public records. Court judgments stemming from unpaid debts, traffic tickets, or even missed jury duty can appear on your credit report and significantly lower your score.
- Government interactions. While uncommon, failing to repay a government benefit overpayment can be reported to credit bureaus, negatively affecting your score.
- Library fines. Unpaid library fines can be sent to collections, which can impact your credit score. Libraries are not mandated to report fines, so they probably won’t affect your credit score. However, be sure to pay your library fines on time to avoid any possible negative impact.
- Renting furniture. Rent-to-own furniture agreements often require you to make monthly payments, which can be reported to credit bureaus. If you miss payments or default on your rental agreement, it can negatively impact your credit score.
- Cell phone bills. Failure to pay your cell phone bill on time can be reported to credit bureaus, negatively impacting your credit score.
- Parking tickets. Unpaid parking tickets can be sent to collections and negatively impact your credit score. Be sure to pay any parking tickets on time to avoid any negative impact.
- Missed tax payments. If you fail to pay your taxes on time, it can be reported to credit bureaus and negatively impact your credit score.
- Divorce. Divorce can have a major impact on your credit score if you and your former spouse have joint debts. If these debts go unpaid or are mismanaged, it can negatively impact both parties’ credit scores.
- Missed jury duty. If you fail to show up for jury duty, it can result in a fine. If you don’t pay the fine, it can be sent to collections and negatively impact your credit score.
- Unpaid Homeowner Association (HOA) fees. If you live in a neighborhood or community with an HOA, failing to pay your HOA fees can result in a lien on your property and negatively impact your credit score.
- Utility bills. Unpaid utility bills (electricity, water, gas) can be reported to collections and impact your credit score. Pay them on time to avoid issues.
- Co-signing on loans. Co-signing a loan for someone else makes you liable for the debt if they fail to repay. This can negatively affect your credit score if the loan goes into default.
- Guaranteeing rent payments. If you act as a guarantor for someone’s rent payments and they default, it can be reported on your credit report and lower your score.
Understanding the wide range of factors that influence your credit score is crucial for maintaining healthy financial habits and ensuring long-term financial stability. Major elements like payment history and credit utilization are well-known, but there are also less obvious factors such as late gym membership fees or missed jury duty. Being aware of these allows you to proactively manage all aspects of your finances, from traditional bills to more unexpected obligations.
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Disclaimer: The article and information provided here are for informational purposes only and are not intended as a substitute for professional advice.
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