Reporting your rent to the credit bureaus creates a new tradeline on your credit report with positive information.
Here’s a little known fact: for most people, their rent payment doesn’t impact their credit at all.
Why? It’s because the major bureaus who keep track of your credit profile don’t know about your rent payments! It has to first be reported.
You now have the ability to change that limit. Credit Builder by LevelCredit makes it easy to get your rent payments onto your credit report with two of the major credit bureaus, TransUnion and Equifax.
With LevelCredit, your rent will show up as a new “tradeline,” which is simply another name for an open account on your credit report. That account can really help your score out, because it only adds positive data on your credit report, which means a higher credit score.
It makes a BIG difference for consumers who are starting out with no credit, a thin credit record or a low score. Although do keep in mind that any kind of collections or delinquencies already on your credit profile may also hinder from seeing a higher increase. LevelCredit does not determine how the bureaus chooses to calculate the scores and depending on the scoring model you are checking scores will vary.
So, how much can a person expect their low score to increase from rent reporting? Well, on average, someone starting out with a score of 579 or below would see an increase of 45 points after 1 year — and 65 points after 2 years. That is an average and is subjective depending on each individual's credit.
Someone who is more established or who already has a high score of 700+ may see a slower increase than someone with a much lower score. Since everyone's credit file is different this number of increase will vary from person to person.