Zillow Says: Now, Your Rental Payments Count for Credit Scoring

Rental payments have traditionally been ignored by credit scores. This makes it that much harder for a renter to qualify to borrow money to buy a home.

So, millions of people have excellent housing payment histories, but are shut out of opportunities that a strong credit profile can offer. Like, you know, getting a mortgage and acquiring a deed.

Finally, Renters: You Are Being Seen

More than half of all renters would like to acquire their own deeds. But many haven’t developed a credit profile that shows their capacity to pay for housing costs, even though they pay these costs faithfully each month. Some 26 million U.S. renters are  “credit invisible,” according to Zillow’s research.

Of course, this impacts generations. A deed is a stake in property that households can pass down to children. And every generation that holds home equity is that much more able to buy a new home.

This month brings helpful news to renters:

• First, here’s what’s happening with Zillow renters. Through their online platform called Zillow Rental Manager, clients set up a rental payment auto-pay system. Or, they can get reminders to make their payments month by month. Clients may opt into credit reporting, so each payment strengthens their credit profiles. More than 140,000 Zillow renters have already opted in to report their on-time rent payments. That’s 63% of renters who pay rent through Zillow, reporting their payments to Experian and Equifax at no extra cost.

• Beginning this month (November 2025), there’s something new for non-Zillow renters. They can get the same advantage the Zillow renters get, for an annual fee of $20. They can opt to have their rental payments reported to credit bureaus — through Zillow’s new partnership with Esusu.

• Also, Fannie Mae and Freddie Mac are now backing loans using VantageScore 4.0, which accounts for rental payment history.

When credit scorers account for a renter’s regular housing payments, they can facilitate better credit ratings for many more borrowers. More applicants will be able to prove their creditworthiness for a mortgage loan.

This is good for lenders as well as renters. Why? Because lenders are in the lending business. They make money through issuing loans. And because the vast majority of people, statistics show, are willing and able to do what it takes to successfully repay a mortgage.

And, to quote Zillow, “everyone deserves a fair shot at home — whether they rent or own.”

The Transformation of Credit Scoring

For decades, the FICO Score® from the Fair Isaac Corp. has controlled outcomes for mortgage applicants. Here’s the thing, though. FICO rewards people with long, robust credit histories. FICO requires at least six months of credit history to even get started. All of this tends to give short shrift to younger people, new U.S. residents, minority applicants, hard workers and strong savers with modest incomes. Many capable borrowers are simply not seen.

Change has been a long time coming. Sensing the pressure, Fair Isaac has said it will “meet evolving user needs” by updating its models. The FICO 9 score, for example, does account for an applicant’s rental history.

And then there’s the competing model: the VantageScore®. It has been found acceptable by Bill Pulte, the Trump administration’s Federal Housing Finance Agency chief.  

The VantageScore can work with credit histories that are at least one month long. This rising model comes from a collaboration among three credit reporting companies: Equifax, Experian, and TransUnion. These are the “big three” credit reporting firms. By blending their three separate scores together, the mortgage industry gets one single score for an applicant. That averages out the three results, which can vary by as much as 50 points. The lender that applies this blended score is going by what’s commonly called the tri-merge model.

Thinking of buying a home? Then you might be wondering how to shape up your credit profile. Here are some important facts on credit profiles — and how you can strengthen yours.

Single-Company Model for Mortgage Credit Checks? Mortgage Banker Association Calls to Dump Merged Scoring

The TransUnion credit reporting company wants Fannie Mae and Freddie Mac to hold onto the tri-merge credit reporting system. TransUnion has issued a statement to say it’s “an ardent supporter of the tri-merge credit reporting model for mortgage underwriting,” at a time when the federal government could shift its support to a one-company model.

TransUnion goes so far as to claim a single-bureau scoring model could lock 4.4 million applicants out of mortgage loan approvals. Cutting down the information that becomes part of the scoring limits opportunity, says Satyan Merchant, a TransUnion senior VP. Merchant stated in an October 2025 press release:

A “single-pull” environment creates significant risk that strong borrowers will lose access to credit while additional at-risk borrowers find themselves in a mortgage they can’t afford.

It could also lead home buyers and their mortgage consultants to pick out the credit score most likely to get the customer to a successful closing. Presumably, TransUnion thinks this could leave quite a few successful buyers “finding themselves in a mortgage they can’t afford.”  

TransUnion still endorses the VantageScore 4.0, which was created by the “big three” companies and became an approved model in July.

In August, the field was shaken up again, as the president of the Mortgage Bankers Association got on social media to call the tri-merge method an “outdated relic.” As Scotsman Guide reported, the MBA president says blending information from the three separate credit reports doesn’t make a big difference in application outcomes.

So now, industry players are competing for the future of credit scoring. Which is better: tri-merge, or just a single pull? Between FICO and the VantageScore group, each claims to have the best model for helping lenders avert mortgage defaults.

Keeping Fairness at the Forefront

Perhaps we’re nowhere near finding out what scores will prevail for applicants in this fast-moving sphere of financial technology. Artificial intelligence (AI), by digesting much more data than any prior scoring tool has ever processed, can be expected to drive further innovation.

AI models can account for many aspects of applicants’ financial lives — including our history of rental payments. Ideally, AI will make the loan qualification process more logical, objective, expansive, and precise year by year. Will AI tech unfold this way?

In a 2019 study of technology and discrimination, the National Bureau of Economic Research found that “lenders charge Latinx/African-American borrowers 7.9…basis points more” for mortgages when they buy homes. The costs, to this segment of home buyers, rises into hundreds of millions of dollars in extra interest every year.

So, a major challenge involves figuring out how financial AI can support an industry that must adhere to fair housing law and policy. Could the use of AI in loan approval decisions copy and repeat old discrimination patterns?

Yes, and that’s a big issue to address.