Does Paying Rent Build Credit?

These days a good credit score will open doors to many opportunities and discounts, but building a good score takes considerable time and effort. Home-owners reap the benefits of making their mortgage payments on time, but what about renters? Does paying rent build credit? Let’s take a look.

What is credit, and why does it matter?

Before we move on to whether paying your rent will build credit, let’s take a moment to get on the same page about, “What is credit and why does it matter?”

Credit is your capacity to purchase what you want now and pay for it later.  Good examples of using credit include purchasing a car, buying a home, and taking out a student loan.  If you’ve done any of these, you are building credit.

There are four different types of credit:

  1. Installment credit – using credit to finance a specific amount of money and paying it back over time in installments, usually monthly.
  1. Service credit – this is credit used for things like cell phones and utilities.  These providers allow you to use their service upfront and expect payment at the end of the billing cycle, usually the end of the month
  1. Revolving credit – this is credit cards.  Credit companies give you a maximum credit line and a, usually, monthly payment.  You are required to pay a minimum amount specified by the credit card company when your bill comes due.  You will be charged interest and possibly other fees if you don’t make the minimum payment.
  1. Charge cards – like credit cards, except they expect you to pay your entire balance at the end of every billing cycle and can’t carry charges over time as credit cards allow.

Now, why does credit matter?  Your credit score, which represents your credit history, i.e., how much you borrow and how quickly you pay it back, shows lenders how responsible you have been at repaying your debt.  This score informs lenders how likely you’ll be at paying back loans and helps them determine whether to give you a loan in the future.

A high credit score (740-799 excellent) or (670-739 good) makes it easier to borrow and can also lower your interest rates. Conversely, a low credit score impacts your ability to finance purchases, which will matter because not many of us have the cash to buy what we want and need when we want and need it.

How can you boost your credit score?

If you’re worried about your credit score, the good news is that whatever your credit is today isn’t permanent.  

If you’ve had a tough time and your credit took a dip, you can rebuild it.  There are several ways to improve your credit.  Here are just a few:

  1. Set up automatic bill payments, so you never miss a due date. First, of course, you have to make sure you have enough money in your account to cover the bill(s) and avoid overdraft.
  1. Pay off credit card balances every month – paying off the balance monthly does two things—1. Allows you to avoid interest charges, and 2. Keeps your credit utilization low.
  1. Track your credit score and dispute any credit report errors.  You can track the three main credit bureaus, Equifax, Experian, and TransUnion, and file a dispute.  Clearing up a disagreement can help elevate your credit score.
  1. Use payment processing platforms like PayRent to help you report your rent payment (see more below).

Paying Rent with a Credit Card

Paying your rent with a credit card can be an excellent idea. 1.  Using a credit card gives you the flexibility to pay your rent if it’s due before payday.  You can pay when rent is due and pay your credit card off when you get paid.  2.  Using a credit card, as explained in #1, also lets you avoid late rent fees.

PayRent’s unique feature allows renters to deliver their rent to landlords on time.  When you pay your rent, you can also earn RentCred™, which gives you access to emergency cash for rent if you need it.  Remember, paying your rent on time boosts your credit score.

Will Paying Rent with a Credit Card Build Credit?

There are ways to report your monthly rent payment and build your credit score and history as a renter.

According to Experian’s latest study on this subject, approximately 75% of people who chose to include their rent payments as part of their report saw their credit improve between 11 and 29 points.

*NOTE – Landlords (creditors) aren’t required to report rent payments to the three bureaus in most cases.  Rent payments are “non-traditional credit tradelines” similar to utility bills.

It is up to the renter, you, to make the bureaus aware of your ON TIME rent payments. Unfortunately, you can’t report your rent payments, but you can use a payment processing platform like PayRent that offers rent reporting services.  

Payrent provides renters with an opportunity to build credit by reporting positive rent payments to all three credit reporting bureaus.  This feature is unlocked when a renter makes a minimum of three on-time payments through the PayRent app. There are no additional costs associated with credit reporting through PayRent.  

PayRent’s RentCred features:

  • 3-bureau credit reporting 
  • No interest short term loans for rent 
  • Late payment forgiveness.

A Final Thought

Credit scores are serious business, and we can all participate in monitoring ours.  Whether you own your home or rent, you can play the credit game, so you have the opportunities you want to live the life you want.

At PayRent we are honored to be of service to renters by helping them report their rent payments to the three credit bureaus. So don’t wait. Let us be of assistance in keeping your excellent credit score or building it.

Reach out to PayRent today.  We’re here to partner with you.


Start collecting rent online in less than 5 minutes.
  • Control when and how renters pay you
  • Automatically remind tenants when rent is due
  • Accept bank transfers and credit cards

**Blog Article Disclaimer*

This blog article is provided for informational purposes only and does not constitute legal advice. The content is intended to offer general information and should not be relied upon as a substitute for professional legal advice tailored to your specific circumstances.

While we strive to keep the information accurate and up-to-date, laws and regulations are subject to change, and the legal landscape may vary based on jurisdiction. Therefore, we make no representations or warranties regarding the completeness, accuracy, reliability, or suitability of the information contained in this article.

Reading, accessing, or using the information provided in this blog does not create an attorney-client relationship between the reader and the author, and any reliance on the information is at your own risk. If you require legal advice or assistance, it is crucial to consult with a qualified attorney who can consider the specifics of your situation and provide advice accordingly.

The author and the platform disclaim any liability for any loss or damage incurred by individuals or entities as a result of the information presented in this blog. We recommend consulting a legal professional before making decisions or taking action based on the information provided in this article.

This disclaimer is subject to change without notice, and it is the responsibility of the reader to review and understand the disclaimer before relying on the information contained in the blog article.

PayRent is on a mission to build a rent collection app that fosters a positive and productive relationship between renters and landlords. We focus less on transactions and more on the people behind them.


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Start collecting rent online in less than 5 minutes.
  • Control when and how renters pay you
  • Automatically remind tenants when rent is due
  • Accept bank transfers and credit cards

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