What Bills Help Build Credit? Maximize Your Credit Potential With These Credit-Building Services

Building good credit is key for your financial future, increasing your chances of getting approved for loans, credit cards, cell phone plans, or rental apartments. If you're starting with no credit history, one of the easiest ways to build it is by reporting your on-time bill payments every month.

Basic recurring expenses provide opportunities to demonstrate financial reliability to lenders. Over time, as you establish a track record of on-time payments, your credit score will rise.

If you want to learn more about how this works, join us as we look at how paying bills on time every month helps build credit step-by-step, as well as the options you have for reporting your rent payments to credit bureaus.

Bills that help you build credit

While most people are aware that loan repayments and credit card payments impact their credit report, many don't realize that other regular bills can also help them build credit. With the use of the proper payment-reporting services (which we'll cover in depth below), paying these bills can positively impact your credit score:

• Credit card payments: Consistently paying your credit card bills on time is one of the most well-known ways to build and maintain a strong credit score.
• Loan payments: Whether it's an auto loan or student loan, making timely debt payments can significantly boost your credit score.
• Utility bills: Companies that provide utilities like electricity, water, and gas don't automatically report to credit bureaus, but third-party services can report these payments for you.
• Cell phone and internet bills: Similar to utility bills, cell phone and internet service payments can also help build your credit history through third-party services that report these payments to the three major credit bureaus.
•  Rent payments: Although timely rent payments haven't traditionally impacted credit scores, they can now through rent reporting services. These services bridge the gap between renters and credit bureaus, offering a way to reflect responsible payment behavior in your credit history.

How do rent reporting services work?

Rent credit reporting services act as a bridge between renters, property managers, and credit bureaus. To get started, first check if your landlord or property manager accepts rent payments through the service of your choosing.

If your landlord approves, you'll then submit proof of address and your rental agreement to the rent reporting service.

Going forward, instead of paying your landlord directly, you'll make a monthly payment to the reporting service, usually for a small processing fee. The service receives the payment, logs it with your rental history, and reports the on-time payment to the credit bureaus.

Rent reporting service options

As you pay rent, you have a number of rent reporting services at your disposal to help you build up your credit score. These services can be split into two categories: those requiring landlord participation, and those you can use on your own. We'll explore both categories in more depth below.

Services requiring landlord participation

Some rent reporting services rely on participation from property managers in order to function. For the following services, the landlord must actively enroll to report your rent to credit bureaus:

1. Azibo

Azibo's online rent payment solution allows renters to make free ACH payments from their bank account. Renters can also choose to pay by debit or credit card with a 2.99% convenience fee.

Using Azibo's rent payment platform allows you to enroll in their Credit Boost program for $4.99/month, which reports on-time rent payments to all three credit bureaus: TransUnion, Equifax, and Experian.

This option offers the most convenience for both landlords and renters, as renters can pay rent and have their payments reported all in one place.

2. Esusu

Esusu is a reporting service that partners with landlords and property managers. With the landlord's permission, Esusu will report your rental payments to all major credit bureaus for free. Renters are automatically enrolled and sent instructions for account set up via email.

3. PayYourRent

With PayYourRent, the landlord or property manager pays all fees. As a renter, it's free to have your payments reported to all three bureaus. You can opt in or out of rent reporting anytime through the portal.

4. Bilt Rewards

Bilt Rewards is only available to renters in properties partnered with the Bilt Alliance, so check with your landlord to see if your building is enrolled. Through Bilt Rewards, you can earn rewards points by reporting rent payments through the Bilt app for free. You can redeem points for rent credits, travel, shopping, and more.

5. Rent Dynamics

Rent Dynamics works with large multifamily property owners and managers. They are part of Fannie Mae's Positive Rent Payment Program that reports on-time rent and utility payments to all credit bureaus. Renters can get up to 24 months of payment history reported.

6. ClearNow

ClearNow debits your rent from your bank account and reports payments to Experian. Your landlord or property management company handles enrollment.

7. Jetty Credit

Jetty Credit is another service that requires the property management or landlord to be enrolled first. If you live in a participating property, Jetty will report your rent payments for free, and you're automatically enrolled when you move in.

Services you can use on your own

These rent reporting platforms don't require your landlord's participation; just sign up and link your bank account, and you'll be able to report your rent to credit bureaus.

1. Boom

Boom offers flexible plans for renters to report their payments. There is a one-time $10 enrollment fee and a $3 monthly fee. You can pay an additional $25 fee to report up to 24 months of rental payment history to help build your credit file. 

2. Piñata

Piñata is a free service for renters. Furthermore, Piñata makes it easy to sign up without your landlord's involvement, saving you both time.

3. Rental Kharma

Rental Kharma charges an initial $75 setup fee, then $8.95 monthly. This choice stands out from the pack, because TransUnion and Equifax receive your full rental history at your current address. You can also add a roommate to your account for an additional fee.

4. RentReporters

RentReporters has a one-time $94.95 enrollment fee, and you can choose a $9.95/month or $7.95/month plan for ongoing reporting to TransUnion and Equifax.

5. Self

Self was formerly known as LevelCredit before being acquired. Their basic free plan allows renters to report rent payments to all three major credit bureaus.

Pros of reporting rent payments to credit bureaus

There are a number of potential advantages to leveraging rent reporting services:

• Establishes a credit history: For those without existing credit accounts, reporting on-time rent payments helps you get a foot in the door with the credit bureaus.
• Improves credit scores: Responsibly paying rent demonstrates that the credit bureaus can trust that you can handle monthly financial obligations.
• Increases financial opportunities: A longer credit history and an increased credit score open up better approval odds and terms for mortgages, auto loans, credit cards, and other lending products that rely on credit checks. Good credit also leads to better insurance rates on cars, homes, and more.
• Encourages timely payments: Knowing the payment data could affect your credit provides extra motivation to pay rent on or before the due date each month. On-time rent payments reflect well on your tenant record.
• Strengthens rental history: A longer record of on-time rental payments reported to credit bureaus can serve as a testament to your reliability as a tenant when applying for new apartments, which could have a major impact on your likelihood to have your applications approved.

Potential drawbacks of rent reporting

While using rent reporting services has many advantages, there are a few potential downsides to consider as well:

• Not all landlords participate: For some of the rent reporting solutions, your landlord must verify their identity, connect to a service, and regularly submit your payment data to the credit bureaus. Landlords who already have a lot on their plate may not be keen on participating. If they don't already use or want to sign up for rent reporting, you'll need to sign up for a service on your own.
• Risk of errors: Mistakes in reported payment dates, amounts, or account details by the landlord or rent reporting service could negatively impact your credit history if not corrected. Be sure to get a free credit report report and monitor your status on a regular basis.
• Uneven credit score impacts: The boost from rent reporting may be smaller for those with extensive credit histories with positive payment records. Renters with limited credit histories tend to see a more notable positive impact.
• No influence on credit use: Rent reporting helps payment history percentages but doesn't affect the amounts you owe on revolving credit balances like credit cards. These other debt payments also factor into credit scores, so you'll still want to keep your balances low.

Tips for using bills to build credit effectively

If you decide to leverage monthly bills to use a rent reporting service, here are some tips for doing so successfully:

1. Check that positive data gets reported: After starting rent reporting or other bill payment credit-building strategies, verify the on-time payments appear on your credit reports. Log into your credit report accounts at least once per month after starting bill payments to confirm your new positive payment history is being added to your report.
2. Watch out for late payments: Payment delays or missed payments could get reported and negatively impact your credit. Avoid this by paying every bill by the due date.
3. Monitor your credit scores: Check your credit scores every 2-3 months to verify the impact of rent and bill reporting and to catch any discrepancies. You should see scores gradually improve as a positive payment history accumulates.
4. Practice responsible credit habits: Pay all your bills on time, maintain low credit utilization, and demonstrate consistently responsible behavior to maximize results.
5. Consider credit mix: Consider opening installment loans and revolving accounts to demonstrate diverse accounts, as this can aid credit scores. Keep older accounts open to show a positive past payment history and aim for a variety of credit types.

What bills build credit?

Paying your bills on time is one of the best ways to build your credit score. Making regular payments for utilities, rent, internet, and phone services shows lenders that you're reliable. Over time, as you establish a history of on-time payments, your credit score will improve. This makes it easier to qualify for loans, credit cards, and other things that require good credit.

So, to build (or re-build) your credit, focus on paying all your bills by the due date. Set up autopay if it helps you avoid missed or late payments. Building credit takes time and consistency, but sticking to on-time bill payments month after month will pay off in the long run. With a good payment history, you'll start getting approved for new credit and see your score go up.

Build credit paying rent FAQs

How long do I have to pay bills to see an improvement in my credit?

It may take six months or more of consistent on-time payments before you see a significant improvement in your credit score. The longer your positive repayment history, the better.

Is there anything I can do if I've had late payments in the past?

Continue making on-time payments going forward. Older late payments will carry less weight than recent ones. Good history can offset past mistakes.