Boost Credit Score: Get 20-50 Points Instantly
Get extra points that boost your credit score
for payments like rent, cell phone and utility bills.
Most credit bureaus calculate scores based only on the information they track for credit card loans, personal loans, mortgage loans and car loans. All kinds of loans.
Why don’t other regular monthly payments, like rent and cell phone, count towards your credit score?
Credit tracking beyond loans
Some groups like Experian are starting to assign additional points in the payment history category for things like apartment rent, cell phone bills, cable bills and utility bills.
This is an important new development for three reasons. First, your rent is typically your biggest expense each month. Second, when you’re just starting to build your credit history you are likely to have a few years of rental payment history before you qualify for a credit card. And third, payment history makes up 35% of the credit bureau formula. It has the single biggest impact on your score.
Research shows these alternative credit indicators are highly predictive when it comes to forecasting positive credit risk. So, credit bureaus are wise to include these monthly payments. It gives a wider perspective to the lenders who use their services to make lending decisions.
How to include rent payments in your score
All three of the major credit bureaus will include rent payments when they calculate your score. However, they can’t include what they don’t receive, and you can’t report your rent directly.
There are two major rental payment reporting services that can help.
Rental Kharma provides 6 months of rental payments to TransUnion. The start-up fee is $50, and then there’s an $8.95 monthly fee. Rent Reporters provides 2 years of rental payments to TransUnion and Equifax. The start-up fee is $94.95, and then there’s a $9.95 monthly fee.
These services make it easier to get your rent payments included in your credit history, but this doesn’t guarantee that your score will go up.
Experian Boost
Our favorite non-loan payment monitoring service is Experian Boost. This new service tracks multiple types of alternative payments, not just rent. Their program includes cell phone, cable and utility bills. It automatically adds those payments to your Experian credit score, without the need to subscribe to a third-party reporting agency.
And Experian Boost is free to sign-up!
The average increase to the Experian credit score is 13 points. However, many Experian Boost subscribers see their numbers go up by 18, 28 or even 50 points.
Sometimes these extra few points are just enough to boost your credit score from poor to fair, which could help you qualify for conventional credit with lower interest rates. So it’s definitely worth the effort to sign-up for this free service.
Conclusion
Can you improve credit paying rent and cell phone? The answer is yes!
When you’re working on your credit rating, it’s important to subscribe to a free service like Experian Boost to get every extra point available.
A few points here, a few points there could nudge your score up from poor to fair, and from fair to good.
Plus, every little increase gives you the motivation you need to keep going.