A new service by Experian and Transunion promises to finally answer the oft asked never fully answered question “How come credit reports don’t factor in rent payments paid on time”? The service, called Rent Track will allow tenants to pay their rent online via credit card or E-check and have these payments automatically reported to the credit bureau, with many credit reporting agencies now factoring these payments in when calculating scores, those with limited or negative credit stand to benefit. Both Experian and the bureau of landlords are already reporting boosted scores in Rent Track users.
A study recently conducted by Experian concluded that 59 percent of renters’ scores improved after using Rent Track. Additionally, the bureau of landlords points to nearly 20 percent of tenants’ scores rising by as much as 10 points or more after their first month of service. Rent Track says that service users should expect an increased average score of 40 to 50 points in total.
The service is simple to use, and can be accessed in as little as two days following registration. All the service entails is signing up on the Rent Track website, have the property manager sign up (if they aren’t already) and then set up bill payment (reoccurring if desired). Tenants have the option to monitor their credit, to ensure the accuracy of the reported payments.
Rent Track is an obvious asset to renters trying to improve their credit rating, but it also offers certain advantages to landlords and property managers. Easy to use online payment eliminates snail mail, paper and other inferior payment systems. Furthermore, with paying rent incentivized, a reduction in late payments should be expected. Rent Track also enables a landlord the ability to screen potential renters.
Potential users of Rent Track, whose property managers are not signed up, can provide information to the service, which will then make a formal request of the landlord to sign up. A monthly fee of $1.95 for multiple deposit users and $9.95 for single deposit users is assessed. This fee is payable by either party.
Many of today’s young people have shied away from the conventional route of credit building. Rent Track provides these individuals a quality option in the effort to build credit and purchase a home some day.
For more information about eligibility for an FHA loan contact FedHome Loan Centers.