If there is one major expense that recurs incessantly it would be your rent bill which is generally paid on a monthly basis. However, rent does not always play a part when it comes to determining your credit scores. The reason behind it is that rent payments are not regularly reported to the relevant credit bureaus hence the information that does not get reported to the bureau definitely cannot be utilized in your credit score’s calculation.
The best thing about this strategy to improve your credit score is that all you have to do is make your rent payments each month promptly. Around thirty five percent of the credit score gets determined by the history of your payments. It does mean that when you pay it timely and report rent to credit bureau via Credit Rent Boost, it can make a massive difference.
How Does It Work?
There are three main credit bureaus where you can report your rent payments. Those are TransUnion, Experian and Equifax. They have made some modifications in the models of credit scoring so that rent payments can also be accommodated into the computation of your credit scores. While many groups are doing their best to promote reporting of rent payments, there are not many landlords who have shown their willingness to join this campaign.
With all these hindrances, there are still some promising results that indicate a continuous and gradual push in the submission of rent report to credit bureau. Experian with the collaboration of New York City conducted a pilot study in 2017. This study revealed that around seventy six percent of the renters who managed to get their rent payments reported witnessed boosts in their credit scores.
TransUnion recently conducted a survey that showed most of the renters want their monthly rent defrayals reflected in the credit reports. This survey also unearthed that around sixty seven percent of people will give preference to those properties that report their rent payments. Furthermore, seventy percent of the participants of this survey stated that the likelihood of prompt rent payments will increase if they get reported to the credit bureau. It signifies that rent report to credit bureau can also be favorable for the landlords, since they would be able to receive payments without any delay.
What Can Renters Do?
Following are some options that you have to get your rent payments reported to the credit bureau.
Talk to Your Landlord
First of all get in touch with the property owner. If s/he is already reporting rent payments or is willing to facilitate from the next month, nothing else would be better than this. However, it is unfortunate that landlord reporting to credit bureaus does not go that seamlessly in most of the cases.
Utilize Your Credit Card for Rent Payments
Even though the rent you pay through your credit card will not get separately listed on the credit reports, still it can improve the credit score. Figure out if your property’s owner accepts payments via credit card. Plus jot down the service fees which you may have to pay for using the credit card as well.
Consider Rent Reporting Professional Services
It is probably the best and most reliable way to report rent to credit bureaus. There are several top-notch professionals who can report all of your monthly rent payments to the relevant authorities. They charge a very small fee for the services provided. The only thing you have to be careful about is to pay rent timely. It can be counterproductive if you delay your payments. You might end up hurting your credit ratings instead of improving it. Be cautious about it!