Boosting your credit score often requires months of ‘good’ financial behavior. But a new tool from Experian allows you to instantly add utility and cellphone payments to your credit report, potentially increasing your credit score and helping you pay less to borrow.
How it works?
You first give Experian permission to scan bank account transactions so it can identify utility and cell phone payments. Information about these payments will then appear in the Experian credit report and be used when certain credit scores are calculated from that data.
The idea is to help customers with thin credit files by incorporating signs of responsible financial behavior that traditionally aren’t seen by credit reporting bureaus. Boost also may help people who are rebuilding their credit after financial setbacks. Experian estimates the product could affect up to 100 million consumers’ scores.
Experian Boost works with the most commonly used credit scores by lenders: FICO 8, FICO 9, VantageScore 3 and VantageScore 4. The average increase was more than 10 points and 13% of users on average moved up a credit band.
If a lender relies on a TransUnion or Equifax credit report for its application process, the tool won’t help your approval chances.
Who will benefit?
Experian expects that two-thirds of consumers will see an improvement. Those with thin credit histories (defined as less than five accounts) and FICO credit scores between 580 and 669 will benefit the most, Experian said.
Ten percent of people who previously didn’t have enough information in their credit file will now have a score. Fourteen percent of those with scores of 579 or lower moved into the 620 to 679 range, enough to get better credit terms.
How Do I Sign Up for Experian Boost?
Signing up for Experian Boost is simple. Just go to the Experian Boost page and create a free Experian account to start the process. You’ll then connect your online bank accounts so Experian can search for any qualifying on-time payments. Once you verify that you want to add the accounts to your credit file, your credit scores will be calculated using the newly added payment information.
The process is simple, and if you receive a boost, you’ll see your FICO® Score increase in just a few minutes. If you have any questions about this product or process email us at firstname.lastname@example.org.