The government’s recent announcement drove attention to rental reporting to help residents build credit and help create a path to homeownership. Specifically:
- Creating a national standard lease agreement and providing pricing history
- Making rental payments on time will count toward someone’s credit scores to help renters looking to one day buy a house
Why does credit score matter? According to Equifax there are 3M+ credit invisible and 7M with thin credit. The rates for unsecured loans range from 7% to 40% and 5 year mortgage rates can be over 7%.
So by taking “credit” for the biggest expense of the month, the residents can technically qualify for better credit products, save on interest charges and eventually access better mortgage rates.
Systemic changes from the government
For the federal government to systemically incorporate rental reporting into all provincial agreements:
- All bureaus would need to accept rent payments – Equifax has been accepting rent payments since 2022 and Transunion is expected to start accepting rent payments in 2024
- Mortgage lenders would need to start using rent payment history(not just credit score) for underwriting purposes
- Landlords would need solutions to enable rental reporting with zero lift and zero friction
A uniform legislative code might support the implementation of the above and similar to Fannie Mae in the US, rental reporting can be financially incentivized by public / private institutions. Such institutions and landlords will want to monitor the impact of rental reporting and illustrate how rental reporting improves financial inclusion(number of residents improving their credit score, reducing their interest cost) and eventually qualifying for their first mortgage.
Zenbase’s role in turning rental reporting into a standard
We do believe that every resident should get rewarded for their positive financial behavior and get rewarded for the most essential payment of the month. We do this by creating the broadest reach within the residential ecosystem(landlords, property management systems, renters’ insurance companies) and removing all the friction around by automating rental reporting and monitoring social impact.
Getting started with Zenbase is easy
Zenbase is already integrated with the major PMS therefore rental reporting doesn’t cost anything to the landlords. Zenbase also allows 3rd parties working with smaller landlords to onboard residents with their leases making sure that regardless of their landlord, any resident can sign up and start reporting their rent payments towards their credit score. In parallel, Zenbase works with their landlord partners to assess their social impact so that it can be included in their ESG reports.
Philipp Postrehovsky | Zenbase COO
Philipp is a marketing leader, brand builder and product visionary who has been involved in the fintech scene for over 17 years. In 2013 he co-founded RentMoola, which continues to be one of North America's leading fintech companies with the mission to eliminate the rent cheque and modernize rent collection for the enterprise. Before that, he was a marketing leader for Mogo Technologies, Wonga Canada and began his career at Electronic Arts. Most recently he was SVP, Marketing at Progressa and VP, Digital Marketing at goeasy. He founded Grind For Kids, a program that raised over $1 million for BC Children’s Hospital Foundation and is a mentor to new entrepreneurs.
