If you’re looking to improve your credit score, we have some great news: Paying rent online can do just that! In 2017, TransUnion studied 12,000 renters who reported their rent payments to credit bureaus over the course of a year. The study found that renters’ scores rose an average of 16 points within six months, and the benefit was greatest for those who started with a credit score below 620.
To see a similar increase in your credit score, try paying your rent online. Doing so ensures your payments are reported, shows credit bureaus what they are looking for, and can combine with credit card payments to increase your score even more. Here’s how.
Ensures Your Payments Are Reported
“Simply paying your rent will not help you build credit,” says Bev O’Shea at NerdWallet. “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 Apartment Homes, 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 contributes to your good credit.
Shows Credit Bureaus 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 pay on time and in full and continue to do so, that becomes part of your score, too.
Combines with Credit Card Payments for Higher Score Gains
To boost your score even more, 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.
Give your credit score a boost by paying your rent online through the resident portal. As you do so, your payments are reported to credit bureaus, showing them exactly what they are looking for. Plus, if you choose to pay rent with a credit card, you may increase your score even more. Happy credit-score-boosting!