Renters who have a good history of paying their bills on time may be about to benefit from a boost to their credit rating.
A report in the New York Times revealed that Experian, one of the leading credit reporting companies in the US, has added a new factor into its credit reporting process – timely rent payments are now taken into account, giving a boost to renters who make it a habit to pay their rent on time. The New York Times reports that two more credit report companies like what they see, and are about to follow suit.
FICO and CoreLogic have both revealed that they too will begin taking into account rent payment histories provided to them by landlords.
Joanna Gaskin, director of product management global scoring at FICO, told the New York Times that consumers could well benefit from any recorded evidence of positive rent payments in the near future.
Almost 50% of consumers considered to be “high-risk” saw their credit ratings boosted by 100 points or more after having their rental payment’s history taken into account, said Experian’s Brannan Johnston. However, they were the only ones to benefit from the initiative, as those consumers with average-to-high credit ratings saw little improvement to their overall scores.
Still, for anyone who has lost their home to foreclosure in recent years, the chance to rebuild their credit history faster by showing they are a “responsible renter” will be most welcome, said the New York Times.
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