Rent payments are an important part of the credit-building journey, whether you’re a landlord, property manager, or tenant. As rent payments can often be used to build a tenant’s credit through the process of rent reporting, they are seen as a valuable tool in the rental world.
Tenants who opt in for rent reporting are more likely to build their credit history faster compared to those who don’t. Plus, if a tenant is willing to use rent reporting to improve their credit, it can be a strong predictor that they make on-time payments with other credit obligations as well, further improving their chances of higher credit.
There are many ways a person can increase their credit score. Since having a good credit score can help with getting a home loan, buying a car, etc., TenantCloud offers renters the ability to build their credit history through rent reporting. Let’s go over it in more detail.
What Is Rent Reporting?
Rent reporting is the process of reporting a tenant's rental payments to major credit bureaus to build the tenant's credit history, often resulting in an improved credit score. Tenants may utilize Rent reporting services through their property management companies, landlords, or with property management software like TenantCloud.
Related: How to Report Your Rent with TenantCloud
What is Back Rent Reporting?
Want to boost your chances of improving your credit score immediately, instead of a little bit over time? Some rent reporting services offer back rent reporting, where tenant’s can report up to 24 months of previous rent payments to the credit bureaus all at once.
Past rent reporting can help you establish a good payment history, create a strong credit profile, and even rebuild damaged credit in just one report.
How it Works in TenantCloud
If you’re already using TenantCloud to make rent payments, it’s easy to get started with rent reporting. There are two rent reporting options available–back rent reporting (a one-time fee of $49.95) and ongoing monthly reporting for $6.95. And the best part?
Tenants currently using TenantCloud can get started with rent reporting anytime. No need to request confirmation from their landlord; they can do this whenever they're ready.
There are a few things to keep in mind.
- Monthly Rent Reporting is recurring, while Back Rent Reporting can only be done once.
- Both payments will be charged on the 21st of the month, no matter when you enable the reporting option(s).
- All payments (including positive rent payments and negative rent payments) will be reported to the credit bureau.
Rent Reporting Benefits for Tenants
For tenants, rent reporting can help build their credit history and improve their credit scores. When rent payments are reported to credit bureaus, they become a part of the tenant's credit report, which can help establish a positive credit history. This can be particularly beneficial for tenants with little or no credit history, as it can help them establish credit and build their credit history.
Additionally, rent reporting can benefit tenants by helping them qualify for loans, credit cards, and other financial products that require a credit check. With a positive credit history, tenants may be able to secure better terms and rates on these products, ultimately saving them money.
Incorporating rental payments into credit reports can result in a significant increase in a tenant's credit score. On average, renters share a credit score boost of nearly 60 points when rental payments are included in their credit history. One of the main benefits of rent reporting is that credit scores increase as early as the first month.
Benefits of Rent Reporting for Landlords
By providing rent reporting opportunities for their tenants' landlords, they reduce the risk of rent defaults and delinquencies. Moreover, rent reporting can benefit landlords by attracting and retaining good tenants. By offering rent reporting options to their tenants, landlords can differentiate themselves from other landlords and provide a unique benefit to their tenants. Rent reporting is an additional benefit beyond standard rental services.
With TenantCloud, tenants can establish a positive credit history, which can help them qualify for loans, credit cards, and other financial products that require a credit check.
Back Rent Reporting Benefits
Back rent reporting offers numerous advantages for renters, enhancing their financial well-being and creditworthiness. Here are some key benefits:
- Immediate Credit Score Boost: Tenants experience a rapid improvement in their credit score within just one month of enrolling in back rent reporting.
- Automatic Reporting Convenience: With back rent reporting, tenants benefit from automatic monthly reporting without any need for manual intervention or landlord involvement.
- Hassle-Free Process: Unlike other rent reporting services, with TenantCloud, tenants are not required to request confirmation from their landlord regarding online rent payment, streamlining the reporting process.
- Flexibility in Reporting: Tenants have the freedom to choose when to report their rent payments, giving them control over their credit journey.
- Comprehensive Payment History: Back rent reporting ensures that both positive and negative payment histories are accurately reported, providing a comprehensive overview of tenants' financial responsibility.
- Simplified Credit Enhancement: By participating in back rent reporting, tenants can easily enhance their credit profile and establish a solid financial foundation for the future.
Back rent reporting offers tenants a convenient and effective way to boost their credit score, streamline the reporting process, and demonstrate their financial responsibility. By taking advantage of this feature, tenants can unlock a range of benefits that contribute to their long-term financial success.
So what are you waiting for? Take a big step towards building a strong credit profile and improving your financial standing. It's an investment in your future that will pay off!
Four Reasons to Enroll in Rent Reporting
- Building credit history.
By reporting rental payments to credit bureaus, tenants with little to no credit history can establish a positive credit history. As on-time rental payments are reported over time, it can increase a tenant's credit score and improve their chances of being approved for loans, credit cards, and other financial services.
- Encourage tenants to pay on time.
Knowing that rent payments will be reported to credit bureaus can incentivize tenants to pay on time every month. Combining rent reports and online rent collection can result in fewer late payments, which can help reduce tenant turnover and improve a landlord’s cash flow.
- Attract renters who are financially responsible.
Tenant screening is a crucial step in finding financially responsible and reliable tenants. Integrating all the tools (asking pre-screening questions, tenant screening, and rent reporting) will result in a more stable tenant base, as financially responsible tenants are more likely to pay their rent on time and take better care of the rental property.
- Free ACH payments.
Enrolling in rent reporting is a smart choice for tenants who want to build their credit history and get free ACH fees with TenantCloud. By setting up automatic transfers from their bank accounts, tenants can guarantee timely rent payments and financial stability without the inconvenience of checks or portals.
Building A Better Future with Rent Reporting
Rent payments are an essential aspect of a tenant's financial responsibility, but paying rent on time alone may not be sufficient to establish a credit history. To ensure that future landlords perceive them as reliable renters, tenants need to consider the importance of including their rental payment information in credit reports. Fortunately, TenantCloud offers a hassle-free rent reporting feature that allows tenants to easily track and report their rental payments.
By taking advantage of this feature, tenants can demonstrate their financial responsibility to potential landlords and increase their chances of being accepted for future rental opportunities. In turn, landlords who use TenantCloud to manage their properties can attract tenants who prioritize timely rent payments and are financially responsible, ultimately building a stronger, more reliable rental community.
This is how to enable Rent Reporting and Back Rent Reporting on your TenantCloud account: https://support.tenantcloud.com/faq/question/902
Frequently Asked Questions
How do I set up Rent Reporting?
Rent reporting services collaborate with credit bureaus to report rent payments. To begin, you would need to sign up with a reputable rent-reporting service provider. This typically involves creating an account on their platform, entering your rental information, and granting them permission to report your rent payments to major credit bureaus such as TransUnion and Equifax.
TenantCloud allows US renters to report their rent payments to TransUnion and Equifax simultaneously, helping to build credit history and increase credit scores. Rent reporting is available for active shared leases with verified landlords/property managers. To activate, click "Enable" on the Rent Reporting widget or in the Additional Services section of the Leases tab. Choose ongoing rent payments or past & ongoing reporting for up to 24 months. Ongoing reporting is $6.95/month, while past & ongoing reporting requires a one-time $49.95 fee for past payments and a monthly $6.95 fee for ongoing payments, both charged on the 21st of the month. You can update your card information or disable Rent reporting on the Lease details page.
How do I check my credit score?
Checking your credit score is an essential aspect of managing your financial health. One common method to obtain your credit score is by requesting a credit report from a major credit bureau. This credit report provides a comprehensive overview of your credit history, including payment patterns, credit accounts, and any negative or positive remarks that may impact your creditworthiness. Property management software like TenantCloud and credit card companies offer credit score monitoring services as part of their customer benefits.
Should I report my rent payments?
Deciding whether to report your rent payments is crucial for individuals looking to bolster their credit profile. Reporting your rent payments to a credit bureau can have a positive impact on your credit history by showcasing your responsible financial behavior, particularly if you consistently make on-time payments. By including your rent payments in your credit report, you are effectively demonstrating your creditworthiness beyond traditional credit accounts like a credit card. This additional information can contribute to a more comprehensive credit profile and potentially lead to an improvement in your credit score over time.
What are TransUnion and Equifax?
TransUnion and Equifax are two major credit bureaus in the US. These credit bureaus collect and maintain vast amounts of data related to consumers' credit activities. This information is used to generate credit reports that provide detailed insights into an individual's credit history, financial behavior, and creditworthiness. By leveraging data from various sources, including lenders, financial institutions, and other credit providers, TransUnion and Equifax compile comprehensive credit reports that are used to calculate credit scores. These credit scores are essential indicators that help lenders assess the risk associated with extending credit to an individual, making them a crucial aspect of the financial landscape.
Those tenants who opt in for rent reporting are more likely to build their credit history faster, especially as rent payments possess strong predictive power into a consumer's likelihood of making payments on other credit obligations. TenantCloud offers users the added benefit of building their credit history through rent reporting, which can strengthen their credit scores.
