Dear Penny: Do I Have to Pay the Bills My Ex Ran Up When I Was in Jail?

Dear S.,

Unfortunately, if the bill was in your name, you’re ultimately responsible for paying it. I wish I had a better answer for you because a $1,000 bill for utilities you didn’t use is the last thing you need.

Since you know your ex-boyfriend isn’t going to pay that money, your next best bet is to talk to the electric company about your options. As long as the bill isn’t sent to collections, it’s not going to show up on your credit report. Because debt collectors often buy delinquent accounts for cents on the dollar, you could ask if you could settle it for a lower amount, provided you can afford a smaller upfront payment. Usually, 30% to 50% is a good starting point.

Another option is to ask the utility company for a payment plan. For example, maybe the company would be willing to set up a payment plan so you can pay it off in monthly installments.

The big thing here is that you want to work out an agreement with the utility company directly. If the bill goes to collections, your credit will take a hit, even if you eventually pay it off.

That’s not necessarily the end of the world, though. While an account in collections can cause serious damage to your credit score and stay on your credit reports for seven years, usually the impact is most severe in the first two years. Your credit score gradually starts to heal after that.

While you try to negotiate a plan with the utility company, it’s also important to be proactive about your finances. People are vulnerable to identity theft while they’re incarcerated. That’s something I’d be especially concerned about in your case since your boyfriend continued to live in your home and probably had access to much of your personal information.

Pull a copy of each of your credit reports from the three credit bureaus by going to annualcreditreport.com. If you see any accounts or other information you don’t recognize, be sure to dispute it with the credit bureaus.

You may want to open a credit account now if you don’t currently have credit, just in case the electric bill goes to collections. If you can’t get approved for a regular credit card, you could apply for a secured credit card, where you put down a deposit and use that as your line of credit. Recovering from a negative mark on your credit report is easier when you have positive information that’s regularly reported to the bureaus.

Above all, try to think of this as a temporary setback. The worst-case scenario is that this bill gets sent to collections. But you’d hardly be the first person in the world with a bill in collections. Focus on resuming the good financial habits you had before you were incarcerated, i.e., paying your bills on time, and your credit can recover from any negative information.

Robin Hartill is a certified financial planner and a senior writer at The Penny Hoarder. Send your tricky money questions to [email protected].