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Understanding Credit Scores

What Is a Credit Score?

A credit score is a three-digit number (typically between 300-850) that represents your creditworthiness. Lenders use this score to evaluate the risk of lending you money. Higher scores indicate lower risk to lenders.

Credit Score Ranges

  • Excellent: 750+
  • Good: 700-749
  • Fair: 650-699
  • Poor: 600-649
  • Very Poor: Below 600

Factors That Influence Your Credit Score

  • Payment History (35%): Record of on-time payments
  • Credit Utilization (30%): Amount of available credit you’re using
  • Length of Credit History (15%): How long you’ve had credit accounts
  • Credit Mix (10%): Types of credit accounts you have
  • New Credit (10%): Recent credit inquiries and new accounts

Benefits of Good Credit

Financial Benefits

  • Lower interest rates on loans and credit cards
  • Higher approval odds for apartments and rentals
  • Better insurance rates
  • Easier approval for utilities without deposits
  • Greater negotiating power for credit terms

Life Improvements

  • More housing options
  • Better employment opportunities
  • Financial security and peace of mind
  • Ability to help family members by co-signing
  • Access to premium financial products and rewards

How Rent Reporting Builds Credit

The Rent Reporting Advantage

Until recently, rent—despite being most people’s largest monthly expense—didn’t help build credit. Rent reporting services like RentRescore change this by:

  • Adding positive payment history to your credit report
  • Creating credit history without taking on debt
  • Establishing consistent payment patterns
  • Diversifying your credit mix
  • Demonstrating financial responsibility to lenders

Who Benefits Most from Rent Reporting?

  • Credit Invisible: Those with no credit history
  • Thin-File Consumers: People with limited credit history
  • Credit Rebuilders: Individuals recovering from past credit challenges
  • Immigrants: People new to the U.S. credit system
  • Young Adults: Those starting their financial journey

Free Credit Resources

Government Resources

  • Consumer Financial Protection Bureau (CFPB)
    www.consumerfinance.gov
    (855) 411-2372
    Free educational resources and complaint filing for financial products
  • Federal Trade Commission (FTC) – Credit
    www.consumer.ftc.gov/credit
    (877) 382-4357
    Information on credit rights and identity theft protection
  • USA.gov Credit Reports
    www.usa.gov/credit-reports
    Official government information on credit reports and scores

Free Credit Reports

  • AnnualCreditReport.com
    www.annualcreditreport.com
    (877) 322-8228
    The only federally authorized source for free credit reports from all three bureaus

Credit Counseling

  • National Foundation for Credit Counseling
    www.nfcc.org
    (800) 388-2227
    Free or low-cost credit counseling from certified counselors
  • Financial Counseling Association of America
    www.fcaa.org
    (866) 703-8787
    Nonprofit financial counseling services

Credit Building Strategies

Beyond Rent Reporting

  • Pay all bills on time
  • Keep credit card balances low (under 30% of limit)
  • Limit applications for new credit
  • Keep old accounts open
  • Check your credit report regularly for errors
  • Consider a secured credit card if you’re starting out
  • Become an authorized user on a responsible person’s account

Common Credit Myths

  • Checking your own credit doesn’t hurt your score
  • Paying off collections doesn’t remove them from your report
  • You don’t need to carry a balance to build credit
  • Closing credit cards can actually hurt your score
  • Paying minimum payments doesn’t help build credit faster

Special Situations

Students and Young Adults

  • Student loans can help build credit if managed responsibly
  • Consider a student credit card with low limits
  • Use rent reporting to establish history without debt

After Financial Hardship

  • Secured credit cards can help rebuild credit
  • Credit builder loans from credit unions
  • Dispute inaccurate negative information
  • Be patient—negative items generally fall off after 7 years

For Immigrants

  • ITIN loans and credit cards for those without SSNs
  • Secured credit cards that don’t require U.S. credit history
  • Rent reporting to establish U.S. credit quickly

Financial Education Links

Know Your Rights

  • You’re entitled to a free credit report from each bureau once every 12 months
  • You have the right to dispute inaccurate information on your report
  • Creditors must respond to disputes within 30 days
  • Negative information generally can’t stay on your report more than 7 years
  • Bankruptcy information can remain for up to 10 years

Contact RentRescore

Have more questions about how rent reporting specifically can help your credit situation?