Are you wondering how to build credit? Great news: You can pay rent online to do just that!
In 2017, TransUnion conducted a study wherein 12,000 renters reported their rental payments to the credit bureaus. The outcome was a 16-point credit score increase on average, and changes took effect within six months! Those who had beginning scores below 620 saw the biggest increase in points.
If you’d like to see a similar effect on your credit score, start paying your rent online! Doing so adds your rent payments to your credit report, offers credit bureaus the information they need, and can be used with credit card payments for better score gains. Wondering how this works? Read on!
Offers Credit Bureaus the Information They Need
While your credit score can vary depending on which credit bureau you ask, they all look at the same basic information. 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.
Adds Your Rent Payments to Your Credit Report
“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 what do you need to do to make sure these rent payments are reported? At The Heights at Signal Hill, our online rental payment system takes care of the work for you! In order to opt in for the credit reporting, follow these steps:
- Log in to your account through the resident portal and click on “Make a Payment Now.”
- Select “Build your credit history by opting in to credit reporting.”
- Enter your information in the credit reporting fields. Be sure to select “yes” for month-to-month lease if you have one, or select “no” and a lease end date.
Use with Credit Card Payments for Better 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, it adds your rent payments to your credit report, offering credit bureaus the information they need. Additionally, if you choose to use a credit card to pay rent online, you’ll see even better score gains! Happy credit-score-boosting!