Can Rent and Utilities Improve Your Credit Scores?

By: By John Ulzheimer The Ulzheimer Group
Date: September 16, 2019

For decades your credit reports have contained a record of how well you

paid your credit obligations. More specifically, this primarily meant

your credit cards and loans. What had been missing from credit reports

for well over 100 years was any record of how well you paid rental

obligations for apartments or homes, and almost all of your utility

bills. Slowly but surely, that is changing.

Over the past several

years a number of options have popped up to assist consumers who rent

rather than own to benefit from making their rental payments on time. Of

course, in order for your credit to benefit from proper rental

management a record of such payments has to make its way to your

consumer credit reports as maintained by Equifax, Experian and


Data Furnishing


it was up to your creditors to provide information about your

liabilities to the credit reporting companies. This process is formally

referred to as “data furnishing” and companies like banks and credit

card issuers are referred to as the “data furnishers.” In the past, in

order for your rent or any other non-traditional credit activity, like

utilities, to end up on your credit reports a landlord, a property

management company, or a utility service provider had to furnish it, and

almost none of them did so.

And because your rent and other

unreported liabilities were never furnished to the credit reporting

companies, your credit scores could not benefit. It was the credit

equivalent of the tree falling in the woods. Nobody heard it.

More Consumer Control Evolves


is a trend evolving which gives consumers some control over the credit

reporting of non-traditional credit accounts. For example, Experian Boost

is available to help you add your utility and mobile phone accounts to

your Experian credit report. This is an example of what’s being called

consumer controlled or permissioned data. You choose and control whether

or not it’s added, and for how long it’s reported.
Several years ago

Experian acquired a company called RentBureau. RentBureau was

essentially a credit reporting database but for landlords and property

management companies. After the acquisition Experian added millions of

rental records to their credit file database, which now appear on

consumer credit reports.

And finally, there are third-party

intermediary companies like RentalKarma and RentReporters which, for a

fee, purport to report your rental history to one or more of the

national credit reporting companies. By doing so, this might improve

your credit scores and help to build or rebuild your credit reports.

Impact on Credit Scores


scoring systems, like the VantageScore credit score, have to be

designed and developed to see and consider non-traditional credit

information, like rent and utilities. Unfortunately, older generations

of commonly used credit scores do not consider rental information. So,

in practical terms, the information is neither helping nor hurting your

credit scores if they’re being calculated by some older scoring models.

All VantageScore models do consider rental and utility accounts if that

information resides in your three credit files.

I personally

tried Experian Boost. I added my power and gas utilities to my Experian

credit report. My score went up 5 points. It cost me a grand total of

zero dollars. I’ll take it!

Should I Add Rent or Utilities?


benefit of adding non-traditional scorable information to credit

reports isn’t for everyone. If you’re sporting a VantageScore of 820,

you don’t need to add your power bill to your credit report. Your scores

are fine and you’re likely getting the best deals lenders have to

If, however, your scores are at or below the national average,

a number that varies between 675 and 700-ish, then adding something

positive to your credit reports could be the difference between an

approval or a denial. Or, at the very least, the score improvement could

mean a better interest rate or a higher credit limit.

The best

news about these consumer controlled options that you can choose to

participate, or you can choose to not participate. Moreover, none of the

available options are permanent. For example, if you try Experian Boost

and your score doesn’t go up at all, then you can shut it down. If

adding rent to your credit reports didn’t help your scores enough, then

you can cancel your subscription.

Disclaimer: The views and

opinions expressed in this article are those of the author John

Ulzheimer and do not necessarily reflect the official policy or position

of VantageScore Solutions, LLC.

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