Investor · Bossier City, LA · Member since 2014 · 118 posts · 14 votes
Does anyone have any experience with online rent payment services that claim to help tenants build their credit? This is what I've found so far and I'm trying to find one with the lowest cost for both landlord and tenant:
Rental Kharma - Not a payment service. Looks like reporting/tracking only. A. Cost for Tenant: One time $45 B. Cost for Landlord: ?
Renttrack - Online payment + Helps improve their credit history. A. ? B. 9.95 (5 e-checks) + 1.95 (each thereafter)
Williampaid - Both. A. Varies on the payment method, but electronic debit via checking account is free. B. Free?
Clearnow - Both A. Free B. $14.95 to $4, depending on which day you set up the debit
Go easy on any kind of service that claims to be a credit repair or assisting service. Nothing works better than keeping your credit cards fluctuating from 5% - 30% of max credit line and paying a mortgage on time, every time.
Go easy on any kind of service that claims to be a credit repair or assisting service. Nothing works better than keeping your credit cards fluctuating from 5% - 30% of max credit line and paying a mortgage on time, every time.
Go easy on any kind of service that claims to be a credit repair or assisting service. Nothing works better than keeping your credit cards fluctuating from 5% - 30% of max credit line and paying a mortgage on time, every time.
I have NO experience and limited knowledge of the online rent payment biz, but there's a web forum dealing with anything and everything related to credit and credit reports, especially anything related to rebuilding bad credit, that I'd say can be as valuable of a resource on that as Biggerpockets is for nearly anything real estate related. Its called "credit boards" and if you post on there, you'll likely get some good answers quickly from people who know the real value of whatever they're doing to supposedly improve someone's credit. Because there's always the chance that yes, it does improve your credit score eventually, but for what it costs vs HOW MUCH it improves someone's credit, they may say it isn't worth doing.
And one thing you'll likely learn on that forum is exactly what Anthony just said, (his comment popped up while I was writing mine) an awful lot of the many different types of businesses claiming to help fix bad credit aren't worth it and some are plain old rip offs!
Does anyone know a property management company who helps tenants improve their ability to manage budgeting and pay rent on time and eventually improve their credit and purchase their own home ? We have been managing rental properties and thinking such managing company will be helpful.
I've been processing auto loan credit applications for 12 years and have yet to see anyone's credit benefit from making rent payments. How could it show up on a trade line (which is where it would need to in order to show payment history) It's neither revolving or installment debt so I don't see how it can help, other than not going to collections.
ERent.com is an online rent collection service. We have been using them for about 2 years. works great. They recently came out with a program where the tenant can sign up with them and they report to the credit bureaus their on time rent payment. This might be what they have been talking about. They charge $3.00 for the rent collection, you can pay it, split it or the tenant can pay it. They have rent reminders, and you get a notice when they submit so you know it is done. Another online service worth mentioning is Buildium.com. They are a property management suite that also allows online rent collection but with a whole lot more. We are in the process of switching so don't know from a user side yet. Great reports from other investors here that are using it though.
Online payments is not the same as Credit Repair. @Roger Laughary has it right - - rents don't show up in a CR and the only line item that does is an Eviction Record but you have to pull that specifically.
Help your tenants to be regular and timely by using popmoney.com to make payments to your account directly from theirs.
Thanks much for your input ! I will check the info provided.
My point was that there are many tenants (low income) who want to buy houses, and enough income, but just do not have skill set or discipline to set aside for onetime rent payment and down payment down the road.... Some system/set up to motivate them can be helpful. Lease option may only work if the owner wants to sell the house down the road. But, it does not work if the owner want to keep the house....
In my small city there are three different non-profits offering financial classes. I got trained to be an instructor, but there are plenty of volunteers. We also participate in an annual event where attendees get an assigned salary and basic budget and they get to make decisions to improve or hurt their situation. My husband plays the loan shark trying to entice them to sign over their paychecks. I am a counselor at the end to help them process their experience.
My point is, it may not make sense to try to marry housing and financial skills, especially if the skills are widely offered in other ways. As landlords, I think we can help with references to other landlords, helping tenants understand the impact of not prioritizing bills well, and maybe helping them fund appliances to keep them away from rent to own stores. It is not realistic or desirable for everyone to be a homeowner. My low income neighborhood is full of owners who can't afford/budget the property taxes, much less general upkeep.
Payment goes from tenant to collection co, then pays the mortgage company and creates a record of payment, which helps both landlord and the time with records of payment, such as VOR verification of rents
Theory of building a credit rating
If you have no credit you need to create credit, you need a job and a goal to build a credit rating. You need to live below your means and bank 10% + of your income
Save $500 or so and find a good secured Visa that reports positive history. Make sure you get the right secured Visa. Some do not report to all the credit bureaus.
Use the Visa to get one credit card like Macy's or Sears, and make a purchase and pay it off in full every month
Learn about credit utilization ratios and stay within those ratios to build a strong FICO score
All you need is a checking account, a savings account, and the secured Visa and one credit card to build a strong credit rating
If you have strong income, use $1000 with two banks
Bank number one, go to the bank manager and say you want a signature loan and create a CD for security or secured signature loan. Make sure it's a major bank like Wells Fargo or Bank of America
With your collateral of $1000, they will give you a signature loan of $1000 over 12 months or so of about $80 payment a month
Take the thousand dollars that was loaned by bank one, go to bank two and do the same thing.
After 12 months you have to successfully paid off 2 installment loans reported to the credit bureaus which will help improve your Fico score of 100 points or so
Make sure you make payments 10 days or more before the due date of all accounts
Rick, you are correct, erentpayment.com, I was going too fast!
Jeff, I believe the initial post started as an inquiry to an online rent collection company that was cost effective and helped build credit, not repair credit. Erent does report to a credit bureau if the tenant wants it to. It is a newer feature they offer. It does not help repair credit.
We don't do low income rentals so I cannot speak to that situation.
Funny how sometimes these threads take their own paths, maybe I just miss read your question.
I also see Hisashi sort of hijacked the post and asked another question which then led the conversation down a different path. @Hisashi N. you could start a new post with your same question and may get more comments.
Online payments is not the same as Credit Repair. @Roger Laughary has it right - - rents don't show up in a CR and the only line item that does is an Eviction Record but you have to pull that specifically.
Help your tenants to be regular and timely by using popmoney.com to make payments to your account directly from theirs.
That is actually incorrect as rent payments can now be reported on the CR as we know TransUnion and Experian currently offer the option:
@Rick S. Interesting - - but the reference cited is advertising and contains no link for HOW-TO - - can you provide that too (pls)?
You would need to use a rent payment service as typically the bureaus don't allow an individual landlord to report rent payments from what I understand. I do work for a rent payment service as a disclaimer and here is the Experian information for individual landlords:
@Rick S. Thank you, that's helpful. However, I see
Realize More Steady Cash Flow Through On-Time Rental Payments
Because tenants can opt-in to reporting their rental payment data to Experian RentBureau and their positive rental payments may be reported on their Experian credit reports, tenants have an incentive to consistently pay their rent on time. This results in landlords receiving more steady cash flow and on-time payments.
Would seem that the tenant has control and after electing the Payment Service, there's a 50/50 chance that the rents are not reported. I'll stay with my current service, but thanks :)
ERent.com is an online rent collection service. We have been using them for about 2 years. works great. They recently came out with a program where the tenant can sign up with them and they report to the credit bureaus their on time rent payment. This might be what they have been talking about. They charge $3.00 for the rent collection, you can pay it, split it or the tenant can pay it. They have rent reminders, and you get a notice when they submit so you know it is done. Another online service worth mentioning is Buildium.com. They are a property management suite that also allows online rent collection but with a whole lot more. We are in the process of switching so don't know from a user side yet. Great reports from other investors here that are using it though.
Does the tenant have to agree to being reported to a credit bureau? What if I want to create a trade line for the rental and report if they pay on time or not? If tenants are allowed to self-report who would say they are are late? Can I just report exceptions?
Does the tenant have to agree to being reported to a credit bureau? What if I want to create a trade line for the rental and report if they pay on time or not? If tenants are allowed to self-report who would say they are are late? Can I just report exceptions?
Hi Shadonna,
At this time the tenant would have to opt-in for the reporting option. We can only report payments processed through our service as we are required to only report "verified" payments. So that is the reason we don't have an option to report non-payment or allow you to create your own trade line to report.
Within our service the payments are marked as Paid on Time by default, however you have the option to mark the payment as Late for credit reporting purposes if ever necessary. Thank you!