How Renting an Apartment Will Affect Your Credit Score

Posted August 17, 2024

Your monthly rent is one of the most important bills that you pay each month. Rent payments should be on time.

Rent payment paid on time in a timely manner helps your credit score, late rent payments and eviction can impact your credit score, and will make it difficult to rent another apartment, but also make it harder to get approved for credit cards and loans. Landlords pull your credit report when you're applying for a rental application. A hard inquiry comes from a credit check can affect your credit score.

Inquiries are 10% of your credit score, apartment hunting may be treated the same as mortgage or auto loan rate shopping. Many tenants screening-related inquiries are included in the special FICO Score inquiry. Apartment-hunting inquiries are handled as just a single inquiry if completed in the same time frame.

Applying for an apartment won't hurt your credit if there's no credit check in the process. You can ask the landlord for their process to find out whether there's a credit review involved.

Some apartment complexes start using a variety of services to report rent payments. All three major credit bureaus offer landlords some rent-reporting abilities. Experian and TransUnion both offer services to landlords, and Equifax has partnered with third-party rent-reporting platforms to report rental information.

There has been some progress in credit reporting of on time rent payments, if you rent from a smaller company or a private landlord, it’s less likely that your rent payments will be reported to the credit bureaus.

Rent payments are included on your credit report, they’re not guaranteed to help your credit score. According to FICO, only a small number of consumers see an effect on their credit scores after having rental added to their credit reports.