There’s no doubt that the sting of soaring inflation is affecting the cost of almost everything—and rent is no exception. It’s no wonder that 15% of the nation’s renters (that’s nearly 6 million people!) are not able to keep up with rent payments. But if you’re a renter that pays rent on time every month, you deserve to get credit for it. When you report your on-time rent payments it can have big payoffs like boosting your credit score and your financial credibility.
If you want to start earning credit where credit is due, we’ve got everything you need to know about how to report your rent and how to choose the best rent reporting service for your needs.
Why you should report your on-time rent payments
If you’re struggling with building credit and finding financial stability, rent reporting is a powerful tool that can set you on the right path. Besides improving your credit score, on-time rent payments enable you to build a positive credit history which can put you at the front of the line when competing for preferred rental housing vacancies.
By reporting your monthly rent you demonstrate financial responsibility, which can be invaluable when applying for future loans, mortgages, or another rental. A consistent track record makes it easier to qualify for lower interest rates and better financial opportunities down the line. It also leads to a more transparent and trustworthy relationship between you and your landlord.
How to report rent to a credit bureau
Understanding the potential benefits and implications of each reporting method will help you make an informed decision about which route aligns best with your financial goals and circumstances.
Have your landlord report it for you
Not all landlords are familiar with rent reporting practices so if you don’t want to sign up for a service on your own, it’s worth approaching them to take the lead. Initiate an open and honest discussion with your landlord about the benefits of reporting rent payments and explain how it could work to their advantage.
For example, even though some landlords may be inclined to skip the extra effort of signing up for a service—and the fees that go along with it—it can actually encourage renters to pay their rent on time. Because rent reporting creates an incentive for tenants to pay on time, not only will it reduce the likelihood of late rent payments but it can save lots of admin time and unlock recurring revenue streams.
You can also reassure your landlord that if they decide to report rent payments, they’ll increase their chances of finding high-quality tenants and improve tenant retention rates. If that’s not enough to convince them, share that reporting rent payments can also enhance their tenant screening abilities. Remember, if your landlord agrees to report your rent for you, you should still get their consent in writing.
Use a rent reporting service
If your landlord isn’t on board with reporting your rent, you can sign up for a rent reporting service on your own. However, be aware that the service you choose may still require your landlord to verify your lease or rent payments. And while your landlord will be off the hook for paying fees, the responsibility falls on you. Many services charge a one-time fee for starting the service which can cost you up to $100, and then you will be charged a monthly fee on top of that. But if you’re trying to establish a good credit report, it may be worth the price, benefiting you for years or even decades into the future. Pay by credit card
Using a credit card to pay your rent saves you the trouble of writing and mailing a paper check. Plus, it gives you the flexibility to earn rewards, take advantage of cashback offers, and build a positive credit history. It can even help you avoid late fees or an awkward confrontation with your landlord if pay day is a little later than your rent due date.
While this option is convenient, make sure the potential costs associated with it won’t hurt your pocket or your credit score. If you don’t pay your bill in full every month, the interest payments can quickly pile up. Putting thousands of dollars of rent on your credit card can also increase your credit utilization ratio—the total debt you have compared to the total credit you have available—and can negatively impact your score.
A step-by-step guide for choosing the right rent reporting service
If you choose to report your rent through a rent reporting service, here’s 10 steps to take to help you pick the best one.
1. Research available options
When exploring different rent reporting services, take into account factors like user reviews, reputation, and track record. It’s important to ask for recommendations from trusted sources, such as fellow renters or housing advocacy organizations. Groups like the Better Business Bureau (BBB) can also provide insight into which services are trustworthy or not.
2. Check reporting frequency
You want the rent reporting service to update your credit report accurately and in a timely manner. When vetting a service, ask how often they report payments to the credit bureaus. Is it monthly, quarterly, etc.? Choose a frequency that aligns with your preferences and lease terms.
3. Understand fees and costs
Even when you’re trying to increase your credit score, budget still matters. Ask about any associated fees for the reporting service and clarify whether there are any additional costs or hidden charges. The most common costs you’ll come across include:
- Signup fee: This is a one-time fee paid at the initial sign-up for the service.
- Monthly fee: An ongoing charge that is incurred for each month you utilize the service.
- Annual payment: Many services offer the option to make a lump-sum payment for a full year, often more cost-effective than the monthly option.
- Historical reporting fee: This fee covers the inclusion of past rental payments on your credit report. Some services provide a choice between a 12-month or 24-month reporting period.
- Second participant fees: This option allows for rent payments to be reported on two credit reports—yours and that of a spouse, partner, or roommate.
- Expedited reporting fees: When you want your rent history added to your credit report immediately, this option can be especially useful if you need a quick score boost when you’re applying for credit.
4. Assess data accuracy and security
A reputable company will have stringent security protocols and data handling practices to safeguard your personal and financial details. But security isn’t the only factor you need to consider. You need to make sure the data they store for you is accurate or else you could end up with misinformation on your credit report.
5. Evaluate customer support and communication
Opt for a service that has responsive customer support and multiple lines of communication including email and phone so you can address any concerns or issues that may arise during the reporting process. This way, if you have any inquiries or need assistance, you know that you can depend on them.
6. Check reporting to major credit bureaus
Confirm that the service reports to at least one of, if not all of, the three major credit bureaus: Equifax, Experian, and TransUnion. You won’t get control of which bureau a lender uses to pull your credit report from, nor will you know which credit report they use. But if a rent reporting service doesn't share your information with the three bureaus, there's a possibility that you might not reap the full benefits of rent reporting when it comes to your credit profile.
7. Read and understand terms of service
When it comes to making your final decision of which rent reporting service to use, don’t skip the fine print. Thoroughly review the company’s terms and conditions and pay attention to any specific requirements, policies, or limitations. You may also want to ask about their cancellation policy, especially if a service requires you to subscribe.
8. Ask about additional services or benefits
Some rent reporting services will allow you to pay rent in multiple installments or include utility or other bills in your credit record. Others may offer credit education resources or credit-building tools so it’s worth exploring these additional features as some extras might come with an extra cost.
9. Verify legal compliance
To ensure your credit information is handled correctly and responsibly, confirm that the reporting service adheres to all relevant laws and regulations, including the Fair Credit Reporting Act (FCRA).
10. Consider long-term viability
Last but not least, assess the stability and longevity of the reporting service. Determine whether or not they’re likely to be a reliable partner for the foreseeable future. Signing up for a service you can trust minimizes the risk of disruptions in rent reporting, which could potentially impact your credit-building efforts. And a service with proven longevity is more likely to adapt to evolving industry standards so you can stay current with the most up-to-date methods for building and maintaining your creditworthiness.
Reporting On-Time Rent Payments with RentSpree
Reporting rent payments to credit bureaus is a win-win scenario for both you and your landlord. And thankfully, it’s not complicated to get started. Most rent reporting services make the process straightforward and hassle-free.
With RentSpree’s Credit Builder you can document your payment history and have it reported to TransUnion. All you have to do is input your payment details and we’ll take care of the rest.
By partnering with RentSpree you can take proactive steps towards building a positive credit history to improve your credit score and open up new financial opportunities in the future.
Learn how RentSpree’s Credit Builder can help you easily report your on-time rent payments so you can get the credit you deserve today.
