Strong Rental Payment History Now Factored Into Credit Scores

by Shilpi Paul

Strong Rental Payment History Now Factored Into Credit Scores: Figure 1

Good renters might be pleasantly surprised the next time they check out their credit scores.

Last year, the credit agency Experian started factoring in rental payment history along with credit card debt, car loans and student loans when they determine credit scores, and soon FICO and CoreLogic will do the same, reported The New York Times this weekend.

From The Times:

Incorporating rental payments into credit scores could affect millions of people who have not established credit histories through credit cards, student loan repayments and other credit sources. “The biggest impact is on individuals who were not previously scoreable,” said Brannan Johnston, the managing director of Experian’s rent bureau. Almost half of those higher-risk consumers experienced an increase of 100 points or more after their positive rental history was added, Mr. Johnston said.

Right now, individual rental payment information is mainly coming from apartment building managers who can share their accounting data. Small building landlords aren’t yet participating, but credit agencies are investigating ways to get that information.

The change could be good news for both buyers and renters: besides helping lock in a better rate for a mortgage, having a strong credit score can boost your chances of beating out the competition for a sweet rental in a city where open houses for desirable apartments attract dozens of interested tenants.

See other articles related to: experian, credit score

This article originally published at http://dc.urbanturf.com/articles/blog/strong_rental_payment_history_will_boost_your_credit/4878

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