INDIANAPOLIS — Credit is a lesson often learned as you go.
Just ask Summer Hudson.
"Credit was never really talked about when I was in school. And then you become an adult, and you start trying to buy things," Hudson laughed.
Hudson said when it was time to buy a home, her credit score wasn't bad. However, a booster would bump her into a better borrowing category.
"The better your score is, the better your rates are," she said.
So she turned to the internet to figure out if she could get her rent payments to count toward her credit.
"I was like, 'Why? Why are we not getting credit for renting, and so much of your income is going to that, and nobody gets credit for it,'" Hudson said.
Hudson found Rent Reporters, a company that reports rent to TransUnion and Equifax.
Your landlord just needs to confirm that you paid rent.
"(The landlord) said once a month, they send them an email saying, 'Hey, are you good?'" Hudson described. "Do they pay their rent? And he just clicked yes or no."
Rent Reporters charges a one-time fee of $95 plus $9.95 a month.
Hudson said her score went up 32 points, saving money on her mortgage interest in the long run.
"If you look at your interest rate over the next 30 years, or 15 years or however many years you're financing, that's hundreds, if not thousands of dollars."
Maitri Johnson with TransUnion said rent reporting also helps people who are credit invisible.
"These are individuals who do not have a credit profile, and have a score that's lower than 350," Johnson said.
Johnson added that people usually see an improvement in six to nine months.
Before you pay for any service, ask your apartment management company if they offer this service at no cost to tenants.
If not, compare services to figure out which one is best for you. Ask how many credit bureaus do they report to, what are the out-of-pocket costs and do you include prior rent payments?
If you're specifically trying to buy a home, mortgage companies Fannie Mae and Freddie Mac announced they're rolling out a credit reporting system that factors in rent payments. Ask your lender if you qualify.