A rent-to-buy (or rent-to-own) arrangement gives you time to fix a low credit score before you apply for a home mortgage. Note that simply paying rent does not automatically repair your credit. You must use the rental period to actively build a positive payment history and lower your overall debt.

 

HOW TO IMPROVE YOUR CREDIT DURING RENT-TO-BUY

Report your rent:

Ask your landlord or use third-party rent-reporting services to send your on-time monthly rent payments to major credit bureaus.

 

Pay other bills on time:

Keep utility, phone, and car payments strictly on schedule so late marks do not hurt your recovering score.

 

Use credit-building tools:

Open a secured credit card or a small credit-builder loan, keep the balance very low, and pay it off every month.

 

Pay down old debt:

Use the extra time in the rental home to clear out old collections, charge-offs, or high credit card balances.

 

 

CAUTION

A late rent or utility payment can harm your credit score even more while you are trying to fix it.