TransUnion: Rent Payment Reporting Benefits Residents, Communities
July 19, 2021
Updated July 19, 2021
1 minute

Rent payment reporting can increase consumer credit scores.

Reporting rent payments to a credit bureau has multiple positive impacts for residents and communities. New data from TransUnion found residents and communities can benefit by reporting rent payments and if they are included on credit files.

Consumers saw an average increase of 60 points to credit scores, and 60% of renters may experience this increase in the first month of reporting. This is most beneficial to subprime consumers—9% of consumers went from unscorable to scorable with an average score of 631 when rent payment tradelines were included in credit files.

“Consumers that are classified as unscorable or below prime represent half of the renter population, yet the majority of those consumers are not receiving any credit for making those rent payments, which is generally the largest monthly payment they make,” said Maitri Johnson, Vice President of Tenant and Employment Screening at TransUnion, in a release.

According to TransUnion, 51% of renters surveyed would be more likely to choose communities if rental payments were reported. ResidentCredit benefits all those involved in the transaction. Residents can build credit history and improve credit scores while property managers track on-time payments and can incentivize residents to pay on time to improve cash flow and reduce delinquencies. A quarter of residents whose payments were reported decreased late payments by up to 50%.