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The Impact Paying Rent Has On Your Credit Score

Your credit score may seem like just a number, but it is so much more than that. It plays an important role in your life! Your credit history can greatly affect the purchases you make, and enable you to obtain things like credit cards, mortgages, and auto loans.

Your rental payment information is included as part of your standard credit report and may be incorporated into certain credit scores. Paying rent late or on time has a big impact on your credit. Consistently paying it on time can boost your credit score, but paying it late or not paying at all can tank your credit!


What Impacts Your Credit Score?

There are a number of different factors that affect your credit score:


• Payment history for loans and credit cards, including the number and severity of late payments


• Credit utilization rate


• Type, number and age of credit accounts


• Total debt


• Public records such as a bankruptcy


• How many new credit accounts you've recently opened


• Number of inquiries for your credit report


How to Improve Your Credit Score

If your credit score isn’t exactly what you hoped it would be, don’t worry! There are steps you can take to improve your credit. Since your credit scores use information drawn from your credit report, your credit activity provides a continually-updated basis of data about how responsible you are with the credit you're currently using.


1. Pay your bills on time:

Your payment history may be reported to the credit bureaus. Delinquent payments are one of the most important factors on your credit report that are considered in many credit scoring models. If you don't pay your bills on time, your credit scores will suffer.


2. Keep your credit card balances low:

A high debt-to-credit ratio (utilization rate) is a sign that you are overextending your use of credit and could be facing financial difficulty.


3. Open new accounts only as needed:

If you plan to open a new credit account for additional spending power or even to attain a better credit mix, be careful. Opening new credit accounts adds hard inquiries to your report and could ultimately result in more debt than you can afford to repay, both of which could negatively impact your credit.


4. Pay off excessive credit card debt:

Paying off debt is one way to reduce your debt-to-credit ratio. This can have a positive result on your credit. On the other hand, if you close unused accounts, it could lower your credit scores because you lose the credit available on those accounts, making your credit balances a greater percentage of your available limits.


5. Check your credit report regularly:

Your credit scores begin with your credit report. The information in your credit report is used to calculate your credit scores. Checking it often can help ensure the information is being reportedly correctly to the credit bureaus. Check to make sure that the amounts owed and your payment history are correctly listed. If any errors are found, you can dispute them with the credit reporting agency.


6. Guard against identity theft:

Fraud and identity theft can ruin your reputation as a reliable borrower. Scan your report often to check for suspicious activity that you don't recognize.


The bottom line - paying rent late can lead to even more problems down the line, including a dismal credit score.

There are a number of different ways you can pay rent with Housing Hub, whether it's through your online tenant portal or with a payslip. You can also use your portal to set up automatic payments. If you need further assistance, call our office today and we help you set up a payment plan.


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651-488-2437
351 Kellogg Blvd East
Saint Paul, MN 55101
Office Hours:
Mon-Fri | 9am-5pm 
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