Millennials Turn to Rental Payment History Services to Improve Credit Scores
Pasadena, CA– (February 22, 2017) – The millennial generation is getting savvy about their finances. According to data released by RentReporters, an increasing number of renters ages 25-34 are proactively reporting monthly rent payments to the major credit bureaus – enabling them build and boost their credit scores.
Rent payment history is only now becoming an important part of calculating credit scores, reflecting the modern economic life of the more than 100 million people in the U.S. whose rent is their major monthly expense. TransUnion, Experian and Equifax already include this type of information in calculating credit scores – if the data is reported.
According to RentReporters’ data:
- There was a 290 percent jump – a threefold increase – in the number of consumers using rental history reporting services from 2015 to 2016. This reflects growing awareness and consumers seeing the benefits for these types of services. Reporting rental history payments can increase credit scores by an average of 50 points within the initial report of 24 months of credit history.
- Late generation Millennials, those between the ages of 25-34, make up the largest group using rental history reporting services at 35.6 percent. Early generation Xers, those between the ages of 35 to 44, are the second largest group at 33.8 percent. According to many reports, these age groups tend to have lower credit scores and have the most credit card debt.
- California tops the list in reporting rental payments with Georgia (#2), Florida (#3), Illinois (#4), and Texas (#5) rounding out the top five states. In 2015, the top five spots consisted of California (#1), Texas (#2), Florida (#3), Georgia (#4), and North Carolina (#5) with Georgia experiencing the highest increase from being ranked at #4 in 2015 to taking #2 spot in 2016. Generally, the Southern U.S. has seen the most increase in consumers using rental history reporting services.
- The majority of renters who fall into the “Credit Invisible” and “Credit Unscorable”- those with no or low credit scores – make up a portion of RentReporters 4,000+ customers. These consumers are most vulnerable to predatory lending and face significant challenges in accessing most mainstream credit markets. While these groups are often the most financially vulnerable, they are often the most credit responsible—as they have to be responsible to pay back a loan at rates as high as 100 percent or more.
“Rent payments have not been one of the historically accepted data sources for calculating credit scores and people should be rewarded for consistent responsible financial behavior,” said John Simpson, CEO, RentReporters. “We not only want to redefine credit scoring, but also lead the way in educating the public about the smart steps to take to build credit.”
For more information, visit www.rentreporters.com.
RentReporters, a leading rental history reporting company, is helping to redefine the calculation of credit scores in a way that reflects modern economic life for the 100M people in the U.S. who have rent as their single major monthly expense. Monthly rent payments are highly correlated with the ability to repay debt in a timely manner, yet they have not been one of the historically accepted data sources for calculating credit scores.
RentReporters enables renters with no or low credit scores, as well as those who already have good or excellent scores, to proactively impact these scores simply by having their monthly rent payments automatically reported to TransUnion, one of the three major credit bureaus. This, along with the company’s credit education initiatives, transparent processes and customer service, creates a clear path for consumers to access and manage appropriate credit. For more information visit RentReporters.com.
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