Rent doesn’t traditionally count towards someone’s credit score — landlords aren’t lenders, so rent isn’t technically debt. However, if a third-party reporting service reports rent payments, a good rental payment history may impact your credit score and show potential lenders that you’re reliable. Just like with a credit card or loan, if you have a rental history of consistent, on-time monthly payments towards your rent, it may positively impact your credit.
To have rent payments considered in your credit score calculation, you have to have them reported to a third-party rent reporting service that then reports them to credit bureaus.[1] This post walks you through the different rent reporting services, the pros and cons of payment reporting, and alternative strategies for building credit.
How rent reporting services work
A rent reporting service is a third-party service that records and reports your ongoing rent payment history to credit bureaus. Some will also report up to two years of past payments at your current residence.
They do generally require a setup fee for individuals to enroll and a monthly or annual fee, though the cost varies depending on the rent reporter. If your landlord or property management company already works with a rent reporting service, or reports rent payments directly to credit bureaus themselves, they may pass on the cost of this to you.
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Rent reporting services for individuals
The next sections detail providers of major rent reporting services for individual tenants. Most have a cost to enroll as well as a cost for ongoing reporting services. Although many tout that they allow you to work independently of a landlord — meaning your landlord doesn’t have to sign up for the service — your landlord may still need to be contacted to verify your information.
Boom
Boom is an app that not only reports rental payments, but also gives renters more control over the payments they make through flexible payment options like installments. It can report up to 24 months of past rent payment history.
- Cost: $10 to enroll, with an ongoing annual fee of $24 and an additional fee for historical reporting
- Reports to: Experian, Equifax and TransUnion
Self
Self's Free rent reporting allows subscribers to add positive rent payments, as well as cell phone and utility bills (electric, water and gas), to their credit report. There's no credit history required and no hard pull.
- Cost: Free with signup; can add utility and cell phone payments by upgrading your subscription for $6.95 a month
- Reports to: Experian, Equifax and TransUnion
Rental Kharma
Rental Kharma is a rent reporting service for tenants who pay rent to the owner of a property, whether it’s a landlord, family member or property management company, so long as the owner can verify the tenant’s payments. It offers historical reporting of all past payment history at your current address, included in the enrollment fee.
- Cost: $50 to enroll with an ongoing monthly fee of $8.95 to keep your account open and current
- Reports to: TransUnion and Equifax
RentReporters
RentReporters is a rent reporting service that offers up to 48 months of past rent payment history for its subscribers as well as ongoing rent payment monitoring. It does require your landlord to verify your payments but is more flexible than some services, allowing tenants who are not on a formal lease to participate.
- Cost: $94.95 to enroll with an ongoing monthly fee of $9.95 or you can pay the signup fee of ($94.95) and pay an annual fee that equates to $7.95 per month
- Reports to: Equifax and TransUnion
Rent reporting services for landlords
While many rent reporters allow you to sign up on your own, only involving your landlord for address and payment verification, some rent reporting services require your landlord or property manager to be the primary point of contact.
For these rent reporters, your landlord would sign up for or pay into the service so that you or other tenants can use it. These services may still have costs for tenants, like subscription fees passed down from your landlord. They also require tenant involvement to ensure that information is reported accurately.
ClearNow
A free service for tenants, ClearNow becomes the intermediary for your rent payments, collecting them from your bank account and depositing them into your landlord’s bank account when rent is due. While enrollment is handled by the landlord or property manager, the service does require tenants’ bank information.
- Cost: Tenants don’t pay directly but may pay indirectly through fees passed on by the landlord
- Reports to: Experian
CreditBoost
CreditBoost is a rent reporting service that offers unique control to the tenant. If your landlord accepts rent payments through Avail, you can turn CreditBoost on and off to report your rent. For example, landlords can manually report late payments that are more than 30 days late. However, because you’re given an alert before your payment is 30 days late, you have the option to make your payment to avoid having a late payment reported.
This service allows you to report past (up to 24 months) or current payments and promises an update to your credit report within 30 days of opting into the service. If you want to report past payments before beginning with CreditBoost, you will pay a fee upfront for this reporting. If reporting current payments, you can pay the historical reporting fee with your monthly subscription. Your landlord will have to verify past payment information.
- Cost: $3.95 per reported month, plus an additional fee if you’re reporting past payments
- Reports to: TransUnion
Esusu Rent
Esusu Rent was created to help people with bad credit or limited credit history build their credit through rent payments. Although it’s currently only available to individuals whose landlords or property managers have an agreement with the service, Esusu Rent has an individual renter program in the works.
- Cost: Tenants don’t sign up for the service but may pay a fee through their landlords; you may get 24 months of past rent reported for a one-time fee of $50
- Reports to: Equifax, TransUnion and Experian
PayYourRent
PayYourRent is a service that handles rent payments, with same-day processing for property managers, allowing you to build credit with each payment. Although renters don’t pay directly for this service, they may pay additional fees to their landlords who opt to use the service and pass along the costs.
- Cost: Renters pay no direct fees to the service provider but may have costs passed along to them by their landlords to cover the service.
- Reports to: TransUnion, Experian and Equifax
RentTrack
The first rent reporter to build relationships with all three major credit bureaus, RentTrack allows tenants to build credit by paying their rent as normal, collecting payment information from the property manager. RentTrack may also be able to report up to 24 months of historical payment data.
- Cost: Ongoing monthly subscription fee, calculated upon signup, which can cost as much as $9.95 per month (your landlord may cover part of that cost). You may be eligible for a one-time fee of $50 for historical reporting, which requires an active subscription and meeting eligibility requirements.
- Reports to: Experian, Equifax and TransUnion
Pros and cons of rent reporting
As with any choice that has to do with your finances, be sure to consider your own personal financial situation to see if the benefits outweigh the costs.
For example, if you consistently make on time rent payments, and have a good payment history at your current address, you may benefit from having this information counted towards your credit score.
Consider some potential pros and cons of opting into a rent reporting service.
Pros:
- May help build credit: If you have poor credit or a limited credit history on your credit report, adding your rent payment history to your credit report may help elevate your credit score. This is especially true if you’ve made on-time monthly payments for the duration of your lease.
- May help start credit: If you have limited credit, or no credit, reporting your rent payments may help you get started, especially if you have a consistent on-time payment history. This demonstrates to potential lenders that you’re reliable and able to handle financial responsibility.
Cons:
- Annual fees and subscription costs: While some rent reporting services are fairly low cost or might have its costs covered by your landlord, many have significant enrollment and ongoing fees. If your rent payment history is spotty, it may not be worth, for example, paying an additional fee for historical reporting, because that may not impact your credit score in a positive way.
- Negative impact of late payments: As with the payment history on any loan or credit product, missed or late payments bring down your credit score.
- Requirements for landlord involvement: Many rent reporting services require some level of landlord involvement, even in the way of just verifying that you live at the address and that they’re receiving your payments.
- On-time rent isn’t reflected in every scoring model: Not all lenders currently use scoring models that factor in rent payments. Rent payments can be factored into your VantageScoreⓇ and recent FICOⓇ scoring models, such as FICO 9 and 10. These are not commonly used scoring models.[7]
How to choose a rent reporting service
When choosing a rent reporting service, be sure to assess the needs of your financial situation, and think of how each option may help you achieve your goals. If you have bad credit or limited credit history, the stakes can feel especially high.
Consider the following factors when weighing your options:
- Look for low-cost options. You want to be sure that the cost doesn’t outweigh the benefit of how much it might impact your credit score.
- Find a reporting service that reports to all three credit bureaus. The more credit bureaus receive the information, the greater the potential impact on your credit score.
- Consider services that report past rent. If you’ve had an excellent rent payment history, meaning you have made consistent on-time payments, for the last two years at your current address, you’ll want to be rewarded for that.
- Decide if you want an independent service or landlord involvement. Opting into a service as an individual comes with the added benefit of sometimes being able to count rent from past addresses towards your credit report or to bring the service with you if you move. On the other hand, your landlord may shoulder the burden of the costs for you.
- Research cancellation requirements. Some services have better customer support than others and fewer requirements to cancel or unenroll if the subscription becomes unaffordable or unnecessary.
Alternative credit building strategies
While reporting your rent can be a way to help build your credit, you can find many other options to help your credit score. Try some of these credit-building strategies.
Consider a credit builder loan
A credit builder loan is a loan that exists specifically to help you build positive credit history.[2] It’s more like building savings while making loan payments. You make monthly payments to the lender until you’ve made all the payments for the loan. Then, the loan money is given to you (minus interest and fees).
A credit builder loan or account can be a good way to start building credit, as many don’t require a credit history to qualify. However, these loans still involve some aspects of traditional loans, like interest, so it’s good to look for flexible rates and terms.
Self’s Credit Builder Account, for example, has four plans with a $9 administration fee , offering different monthly payments, interest rates and lengths, so you choose what works best for your financial situation.
Get a secured credit card
A secured credit card works like a regular credit card — it just requires a security deposit to open an account.[3] The security deposit reduces risk to the lender, so it’s generally easier for borrowers to qualify for a secured credit card than an unsecured one. When you make payments, those payments get reported to the credit bureaus. So making on-time payments can positively impact your credit score.
Become an authorized user on someone’s account
Becoming an authorized user on someone’s credit account means that you’re authorized to use their card to make purchases but aren’t legally responsible for making payments.[4] If the primary user is someone you trust and they trust you, this may be a fairly risk-free way to start building credit, especially if you can’t yet qualify for a credit card yourself. However, be sure the person willing to make you a primary user makes payments as agreed, has had the account for quite some time and maintains a low credit utilization ratio (the revolving balance divided by the credit limit on the card) on the account.
Having a credit card with someone who has a good credit score not only helps you begin building credit if you have poor or limited credit history, but it can also increase your creditworthiness. Keep in mind, however, that not all lenders report authorized user activity to credit bureaus.
Check your credit report and dispute any errors
When trying to build credit, it’s important to monitor your credit health by keeping tabs on your credit report. That way, you’re always aware of your open accounts, balances and, generally, where you stand. You can check your credit report as often as you want without hurting it, and you can check your credit report once per year for free from each of the major credit bureaus, through AnnualCreditReport.com.[5]
Checking your credit report regularly also ensures that you’ll catch any incorrect or misreported information, or missing accounts or payments. Be sure to file a dispute with each credit bureau, if you catch any issues immediately so that they are corrected quickly.[6]
Take credit for on time payments you’re already making
Reporting your rent to credit bureaus may elevate your credit score. If you’ve made consistent, on-time monthly payments at your current address for the last couple of years, this is evidence of your reliability that lenders want to see.
Services like LevelCredit can help make sure that you benefit from your positive rent payment history, past and ongoing. Take credit for the on-time payments you’re already making by paying rent — you deserve to be rewarded for your hard work!
Disclaimer: FICO is a registered trademark of Fair Issac Corporation in the United States and other countries.
Sources
- Experian. “How to Report Payment History to Credit Bureaus,” https://www.experian.com/blogs/ask-experian/can-i-add-good-payment-history-credit-report/. Accessed August 1, 2022.
- CNBC. “Credit builder loans can help you establish credit but they come at a cost—here’s how to know if you should get one,” https://www.cnbc.com/select/what-is-a-credit-builder-loan/. Accessed August 2, 2022.
- CNBC. “Everything you need to know about getting a secured credit card,” https://www.cnbc.com/select/how-secured-cards-work/. Accessed August 2, 2022.
- Experian. “Do Authorized User Accounts Improve My Credit Score?” https://www.experian.com/blogs/ask-experian/authorized-user-accounts-can-factor-in-to-credit-scores/. Accessed August 2, 2022.
- USAGov. “Credit Reports and Scores,” https://www.usa.gov/credit-reports. Accessed August 2, 2022.
- Consumer Financial Protection Bureau. “How do I dispute an error on my credit report?” https://www.consumerfinance.gov/ask-cfpb/how-do-i-dispute-an-error-on-my-credit-report-en-314/. Accessed August 2, 2022.
- U.S. News and World Report. “How Can You Get Credit for Paying Rent?” https://money.usnews.com/credit-cards/articles/how-can-you-get-credit-for-paying-rent. Accessed January 20, 2023.
About the author
Ana Gonzalez-Ribeiro, MBA, AFC® is an Accredited Financial Counselor® and a Bilingual Personal Finance Writer and Educator dedicated to helping populations that need financial literacy and counseling. Her informative articles have been published in various news outlets and websites including Huffington Post, Fidelity, Fox Business News, MSN and Yahoo Finance. She also founded the personal financial and motivational site www.AcetheJourney.com and translated into Spanish the book, Financial Advice for Blue Collar America by Kathryn B. Hauer, CFP. Ana teaches Spanish or English personal finance courses on behalf of the W!SE (Working In Support of Education) program has taught workshops for nonprofits in NYC.
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