3 forms of payment history…

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  • #64345

    According to what I read in another thread we need to show 3 forms of timely payment history for the past 12 months… For the past 12 months I have my rent and 1 credit card. I need one more thing that I’ve paid “on time” I can’t use my electric or cell phone because those are not always paid by the due date and have late payments. Does anyone know if can use daycare? Or Netflix?

    #64346

    Also assuming that I can use daycare or Netflix to satisfy the 3 forms of on time payments Are they still going to want to see my cell phone and electric bills for an entire year and if so will the late payments on those accounts impact my qualification?

    #64348
    Nelsont
    Member

    Before you start worrying about what other bills you can use you will be stopped in your tracks until you have no late payments for 12 consecutive months unless you can document and prove a 1 time emergency in which that emergency came with a bill you paid instead of the other. Your utility company absolutely will report to the credit beureus. The rule is NOT 3 bills that are on time. The rule IS 3 bills that show your address matches your ID and NO late payments for anything.

    For instance paying the bill for the Emergency Room instead of paying utilities is OK. Just being late with no excuse other than you were too tight on cash flow is not OK.

    You can only use bills that are sent to you in the mail or emailed to you with a printable PDF copy that shows your name and address on it and that address and name must match your state issued ID. Netflix doesn’t do this. If your daycare sends a bill to your home or emails you a bill with your address on it then you can use that. P.O. boxes are NOT ok.

    #64349
    Nelsont
    Member

    I think you are getting crossed up here. You CANNOT have any late payments for ANYTHING. The only reason they want to see 3 bills is for proof of address.

    #64350
    TTrumble
    Member

    Hello TattedQueen87,

    First, let me make a correction on something you wrote. Your rent history does not count toward the three on-time trade lines needed for qualification. On time rental history is a separate item since it directly demonstrates your ability to make your mortgage payment on time. The daycare and Netflix can probably be used.

    Here’s the potential problem: Your Netflix (a luxury item) is paid on time for the past 12 months, but utilities (electric/phone) are not. It could potentially throw up a red flag on how you are managing your money, especially if there are multiple late payments. The only way to know for sure is to continue through the process and see if it comes back as a condition from underwriting.

    Tim Trumble
    Online Operations, NACA
    ttrumble@naca.com

    #64351

    @Nelsont well this contradicts what I read in another thread the other day. I actually think that you were the one that we should schedule our bill payments around the cutoff date for our bank statements in order to ensure that the ending balance on our bank statements is on point? Do you recall the thread that I’m talking about?

    So I have to show a year’s worth of billing statements for every single bill that I pay, regardless?

    #64352

    @ttrumble – Okay so I need 3 on time “tradelines” for an entire 12 months and my rent cannot be one of them??? When you say “tradelines” does that mean 3 things that report to the credit bureaus?

    I get paid on the 1st and the 15th. My rent, daycare, and two credit cards must get paid with my 1st paycheck, those are priority things that I cannot be late on. My electric and phone are technically “due” in the first half of the month, however I cannot pay those until after I get my 2nd paycheck on the 15th. Therefore those get paid “late” or after the due date.

    #64353
    TTrumble
    Member

    Hello TattedQueen87,

    It’s really going to depend on what shows up in your credit file. The rule is that all payments that are reasonably in your control must be paid on time for a minimum of 12 months. If those late utility payment show up there, you’re going to have a problem.

    Actually, the example that Nelsont gave is incorrect. Paying an emergency room bill instead of the utilities is the reverse of what we need to see. A trip to the ER is not something that is within your control, and unpaid medical bills are the single most common item that drags down most people’s credit score. It’s the result of a broken healthcare system, not your ability to manage your money. That’s a key example of why we don’t use credit scores.

    Pay the utilities first, then make payment arrangements if needed for the ER bill, then Netflix. It’s a matter of having the priorities straight.

    Tim Trumble
    Online Operations, NACA
    ttrumble@naca.com

    #64354

    @ttrumble My electric and phone DO NOT report to the credit bureaus (I have all three of my credit reports so I know exactly what reports and what doesn’t).

    All of my open tradelines reporting to the credit bureaus (4 credit cards) have 100% positive payment history. Only 1 of those credit cards is 12+ months old though.

    #64355
    Nelsont
    Member

    @TattedQueen87 I am having trouble understanding your logic that moving your billing statements to all be due at the same time so you can pay everything at once equals not having to show 12 months of on time payments.

    I also can’t stress this enough. A bill that is paid 2 weeks after the due date is not necessairly late. It is considered on time unless the company says so. If you read the fine print on every bill you get it will say due on (this date) considered late on (that date). Please check your bills and verify this. Even my naca mortgage through bank of america is due on the 1st of each month but is not considered late until the 18th!!!

    #64357

    @NelsonT Specifically you recommended just waiting to pay particular bills on a certain day of the month. I didn’t realize that you were indicating that we move due dates. Unfortunately not all companies will move due dates (I’ve already tried for both of the bills in question). Also I looked at both the electric and the shone bill statements and both of them state a “due date” and state that if paid after the due date there’s a late charge. So neither of them have a grace period.

    #64358
    Nelsont
    Member

    I also find it unusual the utilities do not report. They probably report under their parent company. But hey this is a good sign. If they aren’t reporting you probably are not late.

    Do you live in a large metropolitan area? Almost every utility company is owned by a big energy/oil company which reports to the bureaus unless you get your energy from a small privately held company.

    • This reply was modified 2 years, 7 months ago by Nelsont.
    #64360
    Nelsont
    Member

    Here’s my advice: take what you have to your intake. The worst that can happen is you need to schedule a follow up.

    #64361

    @NelsonT utilities and phone companies do not report unless your account gets closed and sent to collections. I live in Austin. I have Austin Energy for electric and I have Sprint for cell phone. But I’ve also had other electric companies in the past and other cell phone companies. None of them have ever reported except for T-Mobile and that was only when they sent me to collections after the account closed with a balance due.

    #64362
    Nelsont
    Member

    Interesting. My utility company was purchased by one of Warren Buffet’s companies in 2012 and they do not report on time payments but they report missed payments. Collections obviously always get reported.

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