Are you looking for a simple way to increase your credit score? If so, we have some great news: Paying rent online can help you! In 2017, TransUnion studied 12,000 renters who reported their rent payments to credit bureaus over the course of a year. The results? Renters’ scores rose an average of 16 points within six months. The benefit was greatest for those who started with a credit score below 620.
To see a similar increase in your credit score, consider paying your rent online. Doing so can combine with credit card payments to increase your score even more, ensures your payments are reported, and shows credit bureaus what they are looking for. Here’s how it works.
Combines with Credit Card Payments for Higher Score Gains
If you’re looking to increase your credit score as much as possible, using a credit card made specifically for paying 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.”
While you don’t have to pay your rent with a credit card, it can be a nice little boost to your credit score. In combination with the other benefits of paying your rent online, you’ll be surprised how much it can increase your credit score.
Ensures Your Payments Are Reported
“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 how can you make sure to report your rent payments? At Pacific Palms Apartment Homes, we offer an online rental payment system that reports information to the credit bureaus. That way, credit bureaus easily receive a record of your on-time rental payments, which contributes to increasing your credit.
Shows Credit Bureaus What They Need
What actually goes into a credit score? A credit score is made up of several elements, and it is continually updated to reflect your recent history. 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. Similarly, each time you pay rent on time and in full, that becomes part of your score, too. By reliably paying rent on time, you can increase your credit score dramatically.
Increase your credit score by paying your rent online through the resident portal. As you do so, your payments are reported to credit bureaus, showing them exactly what they are looking for. Plus, if you choose to pay rent with a credit card, you may increase your score even more. Now, go boost your credit score!