How Rent Reporting Works, and Why You Need It
Published November 18th, 2019

In order to really understand the whys behind rent reporting and how effective it can be at improving your credit, it’s key to understand your credit score in itself, as well as the factors that influence it. So in this piece, we’ll break down what your credit score is, why it’s important, and then what rent reporting is and how Zingo uses rent reporting to help you improve your credit score.

The More You Know

Your credit score is a pretty important number that can impact everything from the type of home loan you can get, to the car loans you qualify for, and even your credit card interest rates. So what is a credit score? Credit card lenders and banks need a way to evaluate how likely it is that the person they loan money to will pay it back, how regularly, and how likely those payments are to be on time. They devised a system that ranks potential borrowers against a variety of criteria, for example, how much debt you have versus your total line of credit, your history of paying bills on time, among others. This ranking system distills each individual’s potential risk as a borrower into a 3-digit number. The range of these numbers varies from credit bureau to credit bureau whether it’s Equifax, Experian, or Transunion (the three currently in operation in the United States), however it’s generally somewhere between 300 (not-so-great credit) and 850 (excellent credit.)

How Do Credit Bureaus Determine Your Score?

Each of the three credit bureaus scrutinize your payment history closely to determine what your credit score should be. They also evaluate how much of your available credit you’re prone to utilizing (this percentage should be about 30% of your total available credit if you want to get a good credit score.) They also take into consideration how long you’ve been using credit, and what kinds of credit you use like:

  • Credit card(s)
  • Home loans
  • Car loans
  • Installment accounts
  • Retail accounts

What DOESN’T Count Toward Your Credit Score

While credit bureaus are quite thorough when it comes to traditional payment history and your credit utilization, they do not account for many of things that you probably pay for regularly as a part of going about your daily life. For example, one of the biggest ticket items that most people pay on time every month: Rent.

According to a recent PEW research study, more Americans are renting than at any point in the past 50 years, and for many of those renters, all that financial work they’re doing every month isn’t counting toward their credit score. That’s where Zingo can help.

The Importance of Rent Reporting

By recognizing that so many of us are paying our rent regularly, and on time, every month, Zingo built a rent reporting tool into our service so that you get credit for making those payments. When you sign up with Zingo, we evaluate all the recurring payments you’re making, and report your rent to the credit bureau. Since rent is usually the largest expense for many of us, it stands to make the biggest impact when it comes to our credit scores. 

Think it’s about time you started getting credit for all that responsible rent paying you’ve been doing? We do too. Learn more about how Zingo works, or get started boosting your credit score today!

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