My apartment complex gives us the option to have our rent payments reported to the credit bureaus (not sure if only 1 or all 3). I never selected that option because I was afraid if something happens, I don't want the ding on my credit. However, I've been here 2 years and have been ok at paying on time. I've had a few payments that have been about a week late, but the majority have been on time, and no payments have been over 30 days late. Would it be in my best interest to have it reported? Does it only ding my credit if it is 30 days late?
It wouldn't be in your interest to have it reported. It would increase your number of accounts with a balance and probably decrease your AAoA (definitely if they don't backdate the reporting to when you moved in). If FICO's algo's understand consumer-reported accounts like this as installments, then it would also increase your balance:loan ratio, but I don't know how they see them. Additionally, if your budget is such that you cannot always make your rent payments on time, then you probably wouldn't want to risk having a late reported to the bureaus.
@Slabenstein wrote:It wouldn't be in your interest to have it reported. It would increase your number of accounts with a balance and probably decrease your AAoA (definitely if they don't backdate the reporting to when you moved in). If FICO's algo's understand consumer-reported accounts like this as installments, then it would also increase your balance:loan ratio, but I don't know how they see them. Additionally, if your budget is such that you cannot always make your rent payments on time, then you probably wouldn't want to risk having a late reported to the bureaus.
Thank you for the information. My payment history the first year I lived here wasn't as good as this past year, but I received a promotion a year ago, so that has really helped me. I only had 1 late payment in 2020 and that was because I was on short term disability from work for 6 weeks and only receiving 50% pay. That payment was only about a week late. Besides that, my 2020 payments have been perfect, and I plan to keep them that way.
@Anonymous wrote:I wouldn't
It'd most likely increase your DTI on automated applications -- applications would probably count your reported rent + rent payment account on credit report
Thank you