The online and mobile rental payment solution RentPayment announced plans to integrate with TransUnion’s ResidentCredit program last week (June 25). The partnership of RentPayment, which is powered by YapStone’s payment platform, and the credit agency giant will promote a seamless reporting process of rental payment information, in hopes of boosting the credit scores of renters.
"Rent is the largest monthly expenditure for many Americans today,” YapStone Vice President and General Manager of RentPayment Michael Denbeau said in a company release.
"However, renters who make on-time rent payments each and every month see little to no benefit in their personal credit scores because rent payments are generally not reported to the credit bureaus. Through our collaboration with TransUnion’s ResidentCredit rental payment reporting tool, we are now giving renters the opportunity to build a credit history and potentially improve their credit score by paying their rent on-time with RentPayment,” Denbeau explained.
According to a TransUnion analysis released last year, if rental payments were actually included on credit reports approximately eight in 10 subprime consumers might have experienced an increase in their credit scores just one month into a new apartment lease. The study found nearly 41 percent of these subprime consumers could have potentially gained almost 10 points or more to their VantageScore after one month.
That’s a lot of missed opportunities for renters, which the partnership is seeking to change.
"We’re excited to partner with RentPayment to provide more renters with the opportunity to build their credit histories,” Michael Doherty, senior vice president of TransUnion’s rental screening solutions group, explained. “This is a true win-win situation for both property managers and renters, and we are excited to play a major role in the advancement of this initiative."
The option for mobile and online rental payments is nothing new, but presenting renters with a way to increase their credit scores by performing a task they already do each month may serve as a unique way to ensure property management companies receive rental payments in a timely manner.
According to YapStone, the RentPayment solution is utilized by thousands of property management companies nationwide, representing millions of rental units, which gives a significant portion of the rental industry the potential to benefit from the new service.
"By giving renters a powerful incentive to make their rent payments on time, property managers may benefit from fewer late payments and improved cash flow. In addition, by offering this valuable service to renters, our property management clients will have a compelling differentiator from their multifamily competition,” Denbeau added.
TransUnion ResidentCredit will receive monthly rental payment data of residents who opt-in to the service through either of RentPayment’s online or mobile solutions. This information will populate on the resident’s consumer files, alongside any other financial obligations such as credit cards, student loans and auto loans, YapStone confirmed.
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