Renting isn’t everyone’s top choice when it comes to living arrangements. However, there are some undeniable benefits to renting, including: not being responsible for maintenance, having more afforded freedom with regards to relocating, and the flexibility to upgrade or downsize as needed. Now we can add another little-known benefit to the list: improving your credit score.
How exactly can renting improve credit? Continue reading.
Builds credit history
It is common belief that bad credit is worse than not having any credit history, but this is not entirely accurate. Possessing a positive history of managing finances is important, and your competence in that field is directly reflected by your credit score. Institutions often use credit scores as a measuring device to determine if you are financially responsible enough to handle the service you need from them.
Active record of on-time payments
Payments made on time and in the full amount can have a significant impact on your credit score. In regards to paying rent, you’ll first want to ensure that your landlord is actually reporting your rent payments. You’ll need to order a rental history report through the Experian RentBureau, to discern if your payments are being properly documented.
What if my payments aren’t being recorded?
If your landlord has not been recording your payments, you can request to submit them electronically through an Experian rent payment service affiliate, such as ClearNow, RentTrack, or PayYourRent. These services allow you to make your payments and ensure that they are being recorded through Experian RentBureau.
When properly recorded, all timely payments made for the agreed upon amount will help to boost your Experian Credit score. Experian also does not add any late rent payments to your credit score.
Using a rental as an avenue to build credit or to improve your credit history will prove to be advantageous down the road when making larger purchases that require a solid credit history. .
If you find yourself struggling to keep up with your expenses, Kelley & Fulton can help. We invite you to set up an initial consultation with an experienced bankruptcy lawyer in Florida and learn more about the best steps to take in your situation.