Building up your credit can be tough. But fixing bad credit or improving your credit score is even harder. Especially if you’re a renter.
Traditionally, rent was not reported to credit bureaus as part of your credit history. However, there are some new options that allow you to use your on-time rental payments to boost your credit.
If you’re looking for such a credit-building service, then you may be interested in Rental Kharma.
Rental Kharma review
Traditionally, people used products like secured credit cards to fix their bad credit. And while missing rent payments could land you in collections, they otherwise have little relevant impact on your credit score.
However, credit agencies are coming around to the fact that paying rent can and should affect your credit history.
Some landlords have integrated systems to report rent payments on your credit. Yet, other independent landlords and smaller companies are unlikely to do so. Unless you are potentially using a third-party rent payment system like RentPayment.com provided by your landlord.
If you are like most people, you probably don’t have automatic rent reporting on your credit report. That’s because most landlords don’t report your rent payments to Equifax, Experian, or TransUnion, the big three credit bureaus.
Enter Rental Kharma.
Rental Kharma products
Primarily, Rental Kharma Offers a monthly credit reporting product for renters. They will verify that your rent has been paid, then report it to TransUnion for inclusion on your credit report.
Essentially, Rental Kharma works with your current landlord and reports on time (or late) rent payments to TransUnion.
We all know having a high credit score can be very valuable. And a solid credit history can be the difference between being approved or not approved for a new credit card or loan.
There is no guarantee or exact way to know exactly how much your rental payments will improve your credit score. Especially because your rent will now be treated as a new credit line on your credit report. This is similar to a credit card, loan, or line of credit.
However, an excellent credit score can help you get the best interest rates possible. These, in turn, can potentially help you save tens of thousands of dollars on a mortgage or auto loan.
Bonus tip: You can get your credit report from each of the three major credit bureaus for free each year through AnnualCreditReport.com. And you don’t have to get your three credit reports all at once. I get one every four months.
Behind the scenes with Rental Kharma
Rental Kharma’s service has a $40 one-time signup fee, and a recurring $9.95 per month fee as long as you use the service.
Once you are signed up, everything happens automatically for you behind the scenes. And while it does not cost your landlord anything to participate, they have to agree to participate and verify that your rent was paid each month.
Rental Kharma’s service works if you are the primary renter, on a sublease, split your rent with roommates, or split your rent payment reporting with a spouse. As long as you are a renter and the landlord or building manager agrees to participate, you are good to go.
It is important to note that if you are late or miss your rent, it will be reported as late on your credit. Thankfully, you have a 30 day grace period before Rental Kharma will report rent to the credit bureau as late.
Using the Rental Kharma online platform
Signing up for Rental Kharma is a fast, online process.
Start by heading to the Rental Kharma homepage. Then, click the big button to get started at the bottom of some pages. Or, the navigation menu at the top of the page.
On the first page, you are prompted to add basic contact information: your name, email, and phone number.
On the next page, you are prompted to add information about your credit goals, address, and current lease information. You’re also given the option to enroll a spouse or roommate for a $15 discount.
On the final screen, you enter your social security number for credit reporting and pay the signup fee.
On the last page, you are also given an option to build your credit faster by including rent from the last 24 months.
Whether it was at the same place you are renting now or from a prior landlord, Rental Kharma offers this service for $5 per month for up to 24 months of history. If you choose that option, your signup fee is then $160 (24 months x $5 + $40 signup fee).
While testing the platform, I did come across a couple of bugs. I was redirected to a “completed signup” page when I had not entered anything into a form. This was during my first attempt at using the Rental Kharma system.
For landlords and property managers, Rental Kharma offers credit screening services as part of TransUnion’s SmartMove system.
SmartMove reports screen for credit, criminal, and eviction history for $25-$35 per screening depending on the features needed. In this case, Rental Kharma is acting as a referrer to TransUnion’s SmartMove.
Rental Kharma interest rates and fees
Their basic rent reporting service costs $9.95 per month after a $40 one-time signup fee. For past rent that you want to be included on your credit report, Rental Kharma will verify up to 24 months of history for $5 per month.
Spouses and roommates are eligible for a $15 signup discount when referred by someone else singing up at the same time.
Rental Kharma has a referral program if you send a friend their way. You both get two months of the service for free and you each save about $20 with this offer.
You can also refer up to five friends at once. And if you refer six friends, you get a year of Rental Kharma’s services for free. The best part is, there’s no limit to the number of friends you can refer for the bonus.
Rental Kharma eligibility requirements
Anyone who is renting can use Rental Kharma. If you own a home, your mortgage payment is reported to the major credit bureaus. Therefore, only renters really need this service.
In addition to being a renter, your landlord or property manager has to agree to enter your rent payments each month.
This service only works for legal United States residents with a valid social security number.
If you already have great credit, there is no need to spend the $40 plus $9.95 per month fixing your credit. However, if you have bad credit and want improve it, your rent payments can help by using a service like Rental Kharma.
Rental Kharma customer service
Rental Kharma customer service can be reached by phone, email, or a handy chat widget embedded on the website.
Customer support is available Monday through Friday from 8:30am-6:00pm MST, and is closed on weekends.
More about Rental Kharma
Rental Kharma is headquartered in Denver, Colorado.
Run by CEO Cullen Canazares, Rental Kharma serves low credit individuals renting homes and apartments. The company has a mission of empowering renters and giving renters credit for their positive rental history.
Rental Kharma currently only reports your rent to TransUnion. They do have plans to add Equifax and Experian, the other two major credit reporting bureaus in the United States. However, there is currently no timeline for adding the other credit reporting bureaus.
Rental Kharma contact
Or, you can call them on their local number at 303-219-1902 ,or toll-free at 888-506-4640. You can also reach the business via a live chat feature on its website during business hours.
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