CHICAGO (10/23/14)--Many factors determine a consumer's credit history, and despite what renters believe, rental and utility payments aren't reported to credit bureaus for inclusion on credit reports, according to a new survey from national credit bureau TransUnion.
Forty-eight percent of renters mistakenly believe rental payments are automatically reported to credit bureaus. The confusion about on-time utility payments is even higher--53% believe cable and Internet fee payments are reported to credit bureaus, 54% believe utility payments are submitted and 52% think cell-phone bills are reported.
"Most consumers report paying rent on time, but many don't realize that until now these payments are not boosting their credit histories," said Ken Chaplin, TransUnion senior vice president. "Renters should be aware that property managers are starting to report payments to credit bureaus, and they should be consistently monitoring what is being registered on their individual report."
TransUnion and Experian recently began incorporating reported rental payments into their credit reports and some credit scores.
TransUnion noted that including rental payments in calculating credit scores could be a positive development for many renters. More than three-quarters of respondents said their credit scores would potentially benefit if rental payments were reported to credit bureaus, compared with payments for cable (68%), cell phone service (67%) and utilities (69%).
Nearly 8 in 10 survey respondents said they prioritize rental payments above other monthly bills. The online survey includes responses from 1,001 U.S. consumers between the ages of 18 and 64 who currently are renting the home or apartment in which they live.
"Expanding the share of property managers who report rental payments will produce more accurate information that truly reflects how consistently consumers meet their financial obligations," said Chaplin. "It will benefit renters who want to help their credit scores and landlords who want to attract renters who pay rent on time."