Can Renting Build Credit History

 
Historically building an impressive credit history and higher score was done by paying mortgage, student, and auto loans as well as credit cards on time. The tracking of other reoccurring payments such as rent, cable, utility and mobile phone payments wasn’t taken into account. Even if someone never missed a payment they would still end up with no credit to speak of.
 
Two of the major credit bureaus: TransUnion and Experian are now incorporating rental data in the credit profiles. So paying rent on time can now be an opportunity to increase your credit score.
 
These two bureaus are gathering information through RentTrac. So renters that use RentTrac to make payments are providing information to Equifax and TransUnion.
 
A study done by RentBureau found that after Experian started gathering this information 97% of the study group built a credit score based on their payment history.
 
This also benefitted people already with credit scores also by increasing them 29 points on average.

More Changes?

While bureaus don’t currently count payments on utility, cable, mobile phones, doctors and hospitals, there is a support growing for including some of these into credit history as well.
 
The reasons for this support is because currently paying your phone bills on time doesn’t do anything for your score. However if you fall behind and it goes to collections, that will have a negative impact on your credit score.
 

Credit history, scores may improve with bureau changes by csmonitor.com

The post Rental Payments and Credit Reporting appeared first on National Credit Federation.

When someone researches their credit report for problems and finds collections, usually the immediate response is to begin looking for ways to correct or remove those items from their credit report. The good news is there are a few ways. The most popular way is by disputing them with one of the 3 main credit bureaus (Equifax, Trans Union and Experian) that are reporting them.

You can also contact the collection agency directly and try to… work out a deal with them.  Please make a note here, you must be careful as it is possible to cause more pressure on your credit scores and the level of intensity of the collector.  You simply ask them to remove it in exchange for paying the debt in full or settling in full.   This is called pay for delete. Many collection agencies will tell you that they can’t remove it, but they definitely can. Credit reporting is 100% voluntary and anything that can be placed on it can be removed at any time.

If a collection agency doesn’t cooperate with you, simply don’t pay them because even if they upgrade the account to “paid collection” it is still on your credit report for 7 more years from the date you paid, unless you get them to remove it.  Worse still is in many cases paying a collection will bring your scores down. Of course, you always want to get the agreement in writing as collection agencies don’t always have the most trustworthy people working for them.  Never ever take a verbal agreement with a collection company.

Many people stumble on this part and are unable to persuade the collection company to give a letter of delete and may just believe that paying the debt off will help their credit scores. After the collection company has your money they simply no longer care and will not help.  This is why most complain that this collection or that one should not be reported as they accepted a verbal agreement.  It’s a costly mistake and can be easily avoided when obtaining the services of a professional.

Lesson…most have troubles negotiating with a collection company. To find out if debt settlement might help you check out www.smartdebtrelief.org. Enter in your collection debts, credit card debt or other unsecured debt into the calculator to see just how much you might save every month.

Be Bold!!

Herschel

The post Collection Companies are a pain! appeared first on National Credit Federation.