Utility deposit required based on credit score?

[elessar78]

I recently moved into a new house and I was asked by the electric utility to pay a deposit. She ran a credit check and said because of my Experian score, I was required to pay the equivalent of a 2-month deposit. Since I had just bought a house I knew my credit score from all three bureaus, so I was shocked. FWIW, I'm in the 750+ range. I also don't give two figs about my credit score, but I felt like there was a bit of dishonesty on their part.

Just to be sure I even got my Experian score just to be sure that it had not gone down since I got a mortgage and it had not.

I went ahead and paid it to get my electricity on, but I pressed it a little by asking what the cutoff was and the rep said "she did not know." Apparently management doesn't know either because no one has gotten back to me.

Has anyone had a similar experience?

The funny thing was that they sent me a form letter stating that if I was unsatisfied with the response to contact my state utility authority. Which I did and now that state agency is looking into it.

[snafu]

Have you had an utility electric account for a previous reference? Are you from another state? I wonder if this is a new policy. Have you e-mailed their Director of Customer Service to let them know you have requested assistance from the State's Consumer Services.

I was trying to imagine how much a utlity could collect from new hook-ups over time and how many people might move out of the region having forgotten about that deposit years ago.

[elessar78]

Have you had an utility electric account for a previous reference? Are you from another state? I wonder if this is a new policy. Have you e-mailed their Director of Customer Service to let them know you have requested assistance from the State's Consumer Services.

I was trying to imagine how much a utlity could collect from new hook-ups over time and how many people might move out of the region having forgotten about that deposit years ago.

Yes, we only moved about 5 miles from our old location and it's the same electric utility. So they have my records.

I tried calling and was kept in on-hold hell for a long while until I finally gave up (I think this is an actual tactic).

The guy at the state agency said I'm the FIRST to ever write in about this, just surprised that no one has ever taken issue with this. For reference, the same agency guy told me that this utility has about 6 million customers. Let's assume their threshold for no-deposit is an 800 score, then assuming data is correct 94% of their customers would have to pay the deposit. If it's the same amount as mine, they could collect close to $700,000,000!
That's a $700M slush fund that they can collect interest on for years? decades?


Also, if they are going to hold a deposit for me, will it be collecting interest upon it's return? Sure the interest will be a pittance but still.

[kork13]

So far I've only hooked up my own utilities once (3 years ago in the Florida panhandle), and they did check my credit. However, because of my credit, they actually did NOT require a security deposit. I was fresh out of college at the time (nothing but a 4yr-old credit card and a 1yr-old car loan on my credit), so I rather doubt that my credit score was all too rosy...

I wonder if maybe it was a database mistake, like they punched in the wrong SSN... Even today, a 750+ credit score pretty much makes you walk on water as far as that goes. I'm in the middle of purchasing a home, and my score is ranging between 750-790. I'm qualifying for the best possible rates, both for the home and for the car I bought a few weeks ago. They're just about tripping over themselves to get my signature.

As I mentioned, I'm buying a home right now ( )... I'm going to be setting up my utilities this week, so I'll let you know what happens as far as deposits go.

[elessar78]

I wonder if maybe it was a database mistake, like they punched in the wrong SSN... Even today, a 750+ credit score pretty much makes you walk on water as far as that goes. I'm in the middle of purchasing a home, and my score is ranging between 750-790. I'm qualifying for the best possible rates, both for the home and for the car I bought a few weeks ago. They're just about tripping over themselves to get my signature.

As I mentioned, I'm buying a home right now ( )... I'm going to be setting up my utilities this week, so I'll let you know what happens as far as deposits go.

Good luck with the home purchase, it should be smooth sailing.

But I agree, the banks were very accomodating because of the score. One mortgage banker who had the inside track lost my business because she kept quibbling over .125% after I repeatedly told her what others were offering.

Good luck and keep me in the loop.

[Gailete]

When my son got his first apartment in THIS town, he had to pay a security deposit on his gas. A year or two later they credited him back the money. He had only bought a cars with cash and had a student loan, but a good work history so we don't know why he had to pay it, but I'm glad he got it back already.

Nothing about utilities but we were forced into getting another car this week. Our 13 year old bucket of rust bit the bullet. Hubby spent an entire day tracking down the best deal on a mini-van that he could (I can only get in and out of mini vans due to my knee replacemnts). So we headed off to the car dealership after he spent a few more hours on the phone straining out the best deals close by. While we waited for all the paperwork to go through, I asked the saleman if our financing was okay and he laughed. Said we had a better credit score than 98% of the folks that walked in there! I told him that the way we got such a good score is we didn't use all the credit we could and lived a frugal lifestyle. We refinanced our house 2 years ago and since then, our scores which were already good have gone up around 100 points.

[GrimJack]

TPC (aka 'ma bell') used to charge everyone a deposit for phone service, kept it for 18 months, then gave it back if you paid your bills on time. They essentially had hundreds of millions of dollars to play with at no cost; they were finally sued and now they (and every other utility that requires a deposit) have to pay interest on any deposit and must refund it after 6 months. Everyone's favorite telephone operator, Ernestine (really! back in olden times, there was a person paid to tell you your friend's phone number and connect you! for free!) had it correct when she said "We don't care - we don't have to"

[GrimJack]

TPC (aka 'ma bell') used to charge everyone a deposit for phone service, kept it for 18 months, then gave it back if you paid your bills on time. They essentially had hundreds of millions of dollars to play with at no cost; they were finally sued and now they (and every other utility that requires a deposit) have to pay interest on any deposit and must refund it after 6 months. Everyone's favorite telephone operator, Ernestine (really! back in olden times, there was a person paid to tell you your friend's phone number and connect you! for free!)had it correct when she said "We don't care - we don't have to"

[Like2Plan]

The last time we connected utilities was in 1986. We'd moved from Los Angeles to VA. I kept copies of all our previous utility statements (which showed monthly balances paid on time) and showed them to the new utility companies. No deposit required, but I don't think they did credit checks back then.
It seems absurd that you would be required to pay a deposit with your score.