In the past, only negative information about a renter's payment history was included on credit reports. That meant that the segment of the population, which often included those trying to establish their credit history (i.e. college students or those just starting out), did not get the benefit to their credit history of their timely rent payments. Only if their payments were late would the rental payments show up on a credit report. Obviously, the late payments would damage the credit history of the renter whereas those renters who made their rent payments on time did not see those timely rental payments show up at all in their credit history.
No more. Now Experian is going to include the positive rental payment history of many consumers on its credit reports. Here's the details straight from Experian's website -
On-time rental payments now help boost credit scoresIf reported accurately, this development could help millions of consumers who otherwise have little or no credit history begin to build a credit history and become homeowners if they so desire. Of course, if the rent payment history is reported inaccurately in an adverse manner, the damage done to a developing credit history could be disastrous. Fortunately, the FCRA should help protect victims of rent payment reporting errors in the same manner as it helps rectify credit reporting errors of other kinds.
In the past, only negative rental payment data such as evictions and collections were reported to consumer reporting agencies. Therefore, your on-time rental payments never helped boost your credit scores, unlike credit card, mortgage or car payments that help raise credit scores when paid on time.
But this has changed now that Experian® will be including positive rental data in consumer credit reports. The addition of this data is a tremendous benefit to anyone who rents, especially those who are non-credit-active, cash-based consumers.
Key Benefits to Consumers
Establish or rebuild your credit — You can now make your continuous on-time rental payments count towards establishing or rebuilding your credit
Qualify for what you deserve — If you were previously unable to qualify for a lease or credit product due to a thin credit file you will now be able to demonstrate past rental payment history and qualify for what you deserve
How It Works
Experian RentBureau receives updated rental payment data every 24 hours from its national network of property management companies. In order for this data to be included in your credit file, your property management company must contribute its rental history data to Experian RentBureau.
Experian recognizes the value of having a good rental payment history. Please contact your property management company and ask them to contribute their data to Experian RentBureau.