Paying rent is a part of many people’s routines, but it can also be a great tool for building credit. In 2017, TransUnion studied 12,000 renters who reported their rent payments to credit bureaus and found that they were able to improve their credit score by an average of 16 points within six months. Those with credit scores below 620 benefited the most from doing so.
Paying rent online is an easy way to make sure a record of your consistent, timely payments are being reported to credit bureaus. Here’s a breakdown of how it works.
Ensures Your Payments Are Reported
“Simply paying your rent will not help you build credit,” according to 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.”
How do you know your rent payments are being reported to credit bureaus? At The Lincoln on Grand, our online rental payment system does 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.
Shows Credit Bureaus What They Are Looking For
Building credit is easy when you know what credit bureaus are looking for. Experian, for example, determines credit scores through the following elements:
- Use of credit cards
- Payment history
- Applications for new loans and credit
Since payment history plays a key role in your credit score, it helps to have consistently on-time and in-full payments reported. That’s where paying rent online comes in handy: You can take a payment you already make on a monthly basis and use it to build a long record of payments for credit bureaus to look at.
Combines with Credit Card Payments for Higher Score Gains
While paying your rent online, consider using a credit card for an extra boost to your credit score. LaToya Irby, a credit expert for The Balance, advises, “Open a credit card and use it to pay your rent . . . then pay your credit card balance in full each month. The timely credit card payments will help boost your credit score.”
Paying rent online does not require a credit card, but it does help build a long record of on-time and consistent payments that you make monthly, boosting your credit score.
Ready for better credit? Make the change today and pay rent online using our resident portal. Simply log in and pay. Don’t forget to consider using a credit card to pay rent and boost your credit score even more. Happy credit boosting!