Are you looking to improve your credit score? You can do so by starting to pay your rent online! A 2017 study by TransUnion found that renters who reported their rent payments to credit bureaus over the course of a year increased their credit score by an average of 16 points within six months! The benefit was greatest for those who started with a credit score below 620.
If you aren’t already, start paying your rent online. Doing so will ensure that your payments are reported, credit bureaus see what they are looking for, and your credit score can soar.
Your Payments Are Reported
According to Bev O’Shea at NerdWallet, “Simply paying your rent will not help you build credit. But reporting your rent payments can help you build credit—especially if you are new to credit or do not have a lot of experience using it.”
So how do you make sure your rent payments are reported? At Countrywood Apartments, we offer an online rental payment system that reports information to the credit bureaus. That way, credit bureaus receive a record of your on-time rental payments, which will contribute to your good credit.
Credit Bureaus See What They Are Looking For
What actually goes into a credit score, and does paying rent online contribute? Experian, for example, determines credit scores through the following elements:
- Use of credit cards
- Payment history
- Applications for new loans and credit
When you pay rent online, those payments become part of your payment history. As you regularly pay the full amount on time, that becomes part of your score, too.
Your Credit Score Will Soar
To see your credit score soar, using a credit card specifically to pay your rent may be something worth considering.
“Open a credit card and use it to pay your rent . . . then pay your credit card balance in full each month,” says LaToya Irby, credit expert for The Balance. “The timely credit card payments will help boost your credit score.”
You don’t have to pay your rent with a credit card, but it can be a nice little boost to your credit score in combination with the benefits of paying your rent online.