By reporting rent payments to the credit bureaus you help maximize your rental debt recovery.
First, by reporting your rent payments to the credit bureaus you help prioritize them above other financial obligations your tenants may have that are not being reporting. Second, you offer them a sort of hammer-shaped carrot for making their payments on-time by establishing a positive payment history for them with the credit bureaus. Finally, if all else fails and the tenant moves out or is evicted due to non-payment of rent, you can report their unpaid balance to the credit bureaus as a collection, saving yourself the costs of hiring a third-party collection agency or seeking a judgement in court.
To learn more about the benefits of sharing your rental payment data with the credit bureaus contact us at (425) 780-4530 or email us at firstname.lastname@example.org.
The requirements for reporting rental data are slightly different that those for reporting regular tradelines.
First, similar to reporting regular tradelines, you must go through a verification process called credentialing. During the credentialing process you will be asked to provide several pieces of documentation to verify the ownership of the property and authorization to report.
However, unlike reporting regular tradelines, the bureaus have no minimums on rental data and do not require on-site inspections. This makes it much easier for smaller property owners to report their data to the bureaus.
There are also no requirements on reporting both good and bad accounts. While the bureau still prefers a full file of information, they will accept delinquent-only files from the rental industry.
Reporting rental data is a new industry for the bureaus. Working with the knowledgeable staff at Datalinx will help ensure a smooth and speedy process towards approval.
While each bureau has their own set of requirements for credit reporting, the process for being approved is very much the same.
First, you must become a Data Furnisher which requires going through a verification process known as Credentialing. Generally the credentialing process includes the following items:
- Filling out a membership application with the bureau
- Having an On-Site Inspection conducted on your principal place of business
- Verification Of Business Credentials (i.e. bank and trade references)
In addition, each potential Data Furnisher must meet the reporting requirements of the bureaus (see below). Keep in mind, these requirements may change at any time so it is best to contact the bureaus directly to verify the current requirements.
- Equifax – 500 Active Accounts
- Experian – No Minimum
- Trans Union – 100 Active Accounts
- Innovis – 100 Active Accounts
Active accounts are defined as those with an outstanding balance (i.e. Open Accounts, Charged-Off Accounts, Collection Accounts, etc.). Closed accounts that have a zero balance do not count towards the minimums above, however they may still be included in your file.
It is also important to note that each owner on an account will be counted as an active account. For instance, joint accounts count as two towards the minimum, one for the primary account holder and one for the joint holder.
In addition, the bureaus allow you to go back up to 7 years in your portfolio when determining which accounts to report.
And finally, the bureaus only require the minimum number of active accounts on your first file. Future files may fall below the minimum requirement.
Hopefully following these tips, and working with a service provide like Datalinx, will help you meet the requirements for credit reporting.