One of the things that sets Vantage Score apart from Classic Fico is the inclusion of alternative data such as rent and utilities. The question is, how does that work? Do landlords and Utility companies just start reporting to the bureaus? Unfortunately, it is not that simple.
The bureaus have extremely specific requirements to report to them. Trans Union, for example, requires a minimum of 100 accounts be reported. Equifax requires 500. Experian does not have a minimum, but they do have other parameters. A person/company must also sign Data Furnisher agreements which each bureau. This involves credentialing by the bureaus, on-site inspections and an approval process which can take several weeks. They must also purchase Metro 2 software which can be expensive depending on how many accounts they report each month. They must commit to reporting all accounts every month. It cannot be just a one-time event.
To have rent or utilities reported the consumer must get set up with a third-party reporting agency that reports to the bureaus. There are some that the landlord or property management company can sign up with as well. And there are normally monthly costs for these. It is important to pay attention to how they report as not all report both positive and negative rent and not all report to all three bureaus. Below are the most widely used:
SELF: (Rent and Utilities)
- Reports rent to all three bureaus
- Reports utilities only to Trans Union
- The consumer signs up for this service
- Verifies electronic payment history though a linked bank account.
- Bills must be paid electronically through a bank account linked to PLAID.
- Does report delinquent payments as well as on time payments.
- Does require a monthly fee.
- For an additional one-time fee, they will report 2 years of past history.
RENT REPORTERS: (Rent only)
- Reports to all three bureaus
- Reports any delinquent payment activity only to Trans Union and Equifax
- Can report up to 2 years of past history.
- They contact the landlord/property management company directly or the consumer can use their “RentCheck” option to link a bank account.
- There is a one-time set up fee and a monthly charge.
RENTAL KHARMA: (Rent only)
- Reports only to Trans Union and Equifax
- Back dates the reporting to the move in date
- How the tenant pays rent does not matter
- Verify directly with the landlord or property management company.
- There is a one-time set up fee and a monthly charge.
- Does report delinquent payments.
BOOM: (Rent and utilities)
- Reports to all three bureaus
- For an additional fee will report 2 years of past history
- Must have a bank account linked to PLAID and pay bills electronically. They link to the bank account.
- Reports only positive payments. Does not report delinquent payments.
ESUSU: (Rent)
- Used by both consumers and landlords/property managers.
- Reports to all three bureaus
- Can report up to 24 months of past history.
- Links a consumer’s bank account to their platform through PLAID.
- If a landlord/property management company is utilizing the service, it is free to the consumer. (however, the landlord/property management company may pass the cost along to the tenant)
- If the consumer is utilizing the service and the landlord is not there is a monthly fee.
- They do not report delinquent payments.
PAY YOUR RENT: (Rent)
- This is for landlords/property management companies only to sign up with
- Reports to all three bureaus
- There is a cost for the landlord/property management company that they may pass along to the borrower.
- Reports only one-time payments
TURBO TENANT: (Rent)
- Used by both landlords/property management companies and tenants.
- Reports only to Trans Union and Equifax
- Reports only positive payments
- There is a fee for both the landlord and the tenant.
- Links to bank accounts through PLAID
RENT TRACK: (Rent)
- Reports to all three bureaus
- Used by tenants and property management companies/landlords.
- There is a monthly fee for both the tenant and the landlord/property management company.
- Focus on positive payments but will report delinquent payments.
- Links to the tenants’ bank account
- For an additional fee they will report past payments back to when the lease started.
SIMPLEBILLS: (Utilities)
- Reports only to Trans Union and Equifax
- There is a monthly fee.
- Links to your bank account, credit, or debit card.
- The bills are sent directly to Simplebills, and they pay the bills as they come in.
- The money for the bills must be in the bank account.
eCredable: (Rent and Utilities)
- This is a Trans Union product.
- Reports only to Trans Union
- Will report both rent and utilities.
- There is a monthly fee to sign up.
- For consumers only
Experian Boost: (Rent and Utilities)
- There is no fee for this service.
- Is for Experian only.
- Will report rent and utilities.
- Must link a bank account to the service.
- Only adds on time payments.
- For consumers only
Having rent and utilities reported could be a game changer in credit reporting as it could help a large number of underserved borrowers with limited or problematic credit history. They will just have to be diligent and jump through a few small hoops in order to get that to happen.