One of the country’s three major credit bureaus is now factoring positive rental payment information into its scoring system.
The move by Experian paves the way for both positive and negative rental data to help shape a prospective borrower’s credit score. The agency will cull the information through RentBureau, a specialty credit reporting group used by thousands of property managers and landlords nationwide. Experian acquired the company last year.
“Given that one-third of the U.S. population rents, we felt it was imperative to reflect the true creditworthiness of those individuals who responsibly pay their rent,” Brannan Johnston, vice president and managing director at Experian RentBureau, said in a news release.
For now, Experian is the only credit agency to collect and incorporate this type of rental data. But it probably won’t be the last. FICO officials plan to evaluate the information for future consideration.
The use of rental data could help scores of potential borrowers boost their credit scores and widen the pool of people eligible for financing.