What if my business has bad credit history? Energy suppliers take credit issues very seriously with their customers. There are number of solutions that Energy4 can look at and see what Energy4 can do to help you move to another supplier. We all know we’re supposed to pay our bills on time and carry as little debt as possible—the two major factors that go into calculating our credit scores. Yet, there are other, smaller factors many people aren’t aware of that can also have an impact on our scores. KEY TAKEAWAYS Failing to pay even small bills could lower your credit score. Too many recent applications for credit could also be a negative. If you have a business credit card and are the primary account holder, it can also show up on your personal credit report. 1. Small Unpaid Debts Many people pay their mortgage, credit card, and utility bills with unflappable consistency, yet neglect smaller debts. They may feel these debts are less important or that they will just go away if ignored. But sometimes they won’t. Municipalities were once known to report unpaid parking tickets and even library fines to credit bureaus, for example, although that practice has largely been curtailed. Still, other unpaid debts, however trivial they may seem, can weigh down your credit score. 2. Utility Bills Your electricity or gas bill is not a loan, but failing to pay it can hurt your credit score. While utility companies won’t normally report a customer’s payment history, they will report delinquent accounts much more quickly than other companies you may do business with. 3. Too Many Recent Credit Applications It can be tempting to sign up for new credit cards that offer an attractive bonus for your business. Banks may offer tens of thousands of points or airline miles, while retailers provide in-store discounts when you apply for their credit card. A single application may have little effect, but too many in a short time period can lower your credit score. So limit your number of applications for credit, especially if you are getting ready to shop for a home, car, or student loan, where a strong credit score could be extra important. 4. Long-Term Loan Shopping To allow consumers to shop around for the best rates on automobile, student, and home loans, FICO will not penalize people who have multiple credit inquiries in a short period of time. Various FICO formulas discount multiple inquiries within either 14 or 45 days.1 However, continuing to shop around for a loan over several months will fall outside of this safe harbour and likely lower your score. 5. Business Credit Cards Do you have a credit card for your business? If you are the primary account holder on the card, most banks will hold you personally responsible for any debts you rack up with it, as well as reporting your payment history to the credit bureaus. Late payments or unpaid debts will affect your personal credit, so be sure to use any business cards as judiciously as your personal ones. 6. Mistakes You Didn’t Make Incorrect information in your credit history can hurt your score. People with common names, for example, frequently find other people’s information in their file. In other cases, typos and clerical errors result in adverse information affecting your score. This is one of the reasons consumers are encouraged to check their credit reports at least annually and dispute any mistakes they find. You can obtain free credit reports once a year from each of the three major credit bureaus through the official website, AnnualCreditReport.com. One of the best credit monitoring services could also be useful in this endeavour. Review your credit reports at least once a year to check for errors or missing accounts you’d like to see listed. 7. Missing Accounts Sometimes the problem isn’t what’s in your credit report but what’s not in it. Some of your creditors may not supply information to the credit bureaus. That could mean a lower credit score if, for example, a credit card you have a pristine record of paying off on time isn’t included in your report, while another, where you’ve missed a payment or two, is. If you find any such accounts have been left off your report, FICO suggests you either “ask your creditors to begin reporting your credit information to credit bureaus” or “consider moving your account to a different creditor who does report regularly.”2 If any of these factors are weighing down your credit score, one of the best credit repair companies might be able to remove these negative marks on your credit reports on your behalf. Bad credit energy suppliers, energy providers with no credit check Most energy companies carry out credit checks to ensure you’ll be able to pay your bills regularly and on time. You see, the majority of utility providers let you pay for your gas and electricity via direct debit or by bill receipt – which means you only pay for what you use. To that end, providers run credit checks to ensure you’re in a position to pay for your utilities before accepting you as a customer. But don’t worry – utility credit checks aren’t as stringent as those on credit cards or loans. Chances are that rather than being turned down altogether, you may be offered a tariff the provider deems more suitable for you. Why do energy companies perform credit checks? The more people skip payments or fail to pay their bills on time, the higher the chance is that gas and electricity prices will increase over the long term. This is because ultimately the provider has to pick up the cost of those missed payments. Credit checks are used to mitigate this risk. Gas companies with no credit check Nearly all the big six energy companies – British Gas, E.ON, Scottish Power, npower and Southern Energy – perform credit checks before you can sign up to a deal. The only exception is EDF Energy. At the time of writing, it doesn’t carry out a credit check on new customers wanting to take out a post-pay tariff. That said, you should still try and improve your credit rating, if you can. You’ll have more deals to choose from and you’ll likely end up saving more over time. Electricity companies with no credit check Unfortunately, it’s difficult to find an electricity company that doesn’t run credit checks. At the time of writing, EDF is the only major provider that will not require you to pass a credit check. As we say, though, try not to let this be your deciding factor. It’s always better to at least try and improve your credit score rather than going for a provider on the basis that it doesn’t run credit checks. Do energy suppliers do credit checks? Yes, the majority of suppliers perform credit checks on potential customers. The good news is that these type of credit checks aren’t as rigorous as the tests for loans or credit cards. Indeed, if you fail a credit check for one tariff, your chosen provider will most likely suggest one it thinks is more suitable for you. No credit check energy providers Nearly all the big six energy suppliers request that you pass a credit check so they can be confident that you’ll pay your bills consistently and on time. To check your credit score, sign up to a free credit checker online. This way, you’ll be able to keep tabs on your credit score, identify what might be affecting it, and find ways to improve your rating over time. Can I get an energy deal without passing a credit check? The easiest way to avoid a credit check is to opt for a prepayment meter – also known as a pay-as-you-go meter. They’re installed in your home and let you simply top-up each time you need gas or electricity. With these meters you pay for the electricity before you use it, so there’s no credit check to pass. Good thing is, you won’t be taken off guard – you’ll know exactly how much gas and electricity is available to you, and when it’s likely to run out. And because there’s no contract, you can choose to sign up for different energy tariffs whenever you want. Downside is that prepayment meters are usually more expensive per unit of energy than other tariffs. If you want to get a good deal, we recommend fixing your credit history, first so you can shop around. FAQs How can I improve my credit history to get an energy deal? There are a number of ways you to improve your credit rating, including: Paying outgoings on time, especially energy bills. Register your address on the electoral roll. Ensure you have a proper bank account and all of the information is correct and up to date. Don’t link your finances to people with bad credit – joint accounts, utility bills, etc. – if you can help it. Contact Energy4 today for further information Location: 25 Hartley Meadow, Whitchurch, Hampshire, RG28 7BW Opening Hours: 8:00 – 17:00 Mon to Sat To discuss further, please contact Energy4 Telephone: Call us on 01642 888814 & 01642 888816 Email: contact@energy4.co.uk Please provide the best date and time of day that we should contact you Click here to contact Energy4 today Contact Energy4 today for further information Information 1 Information 2 What if my business has bad credit history? What if my business has bad credit history? What if my business has bad credit history? What if my business has bad credit history? What if my business has bad credit history? What if my business has bad credit history? business electricity business gas