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SCOTT'S MAKING RENT COUNT

Comptroller Stringer Announces NYC’s First “Making Rent Count” Pilot Program

FIn partnership with Banana Kelly, Comptroller Stringer to pilot new program to help New Yorkers boost their credit scores just by paying their rent

Over 600 New Yorkers across 27 buildings in the Bronx will be eligible for new pilot

Comptroller Stringer, in partnership with the Banana Kelly Community Improvement Association, recently announced a new pilot program for the Comptroller’s “Making Rent Count” initiative, which will help New York City tenants establish or boost their credit scores just by paying their monthly rent. Working with Banana Kelly leadership, more than 600 tenants across 27 buildings in the south Bronx will now be able to add their rent payments to their credit histories, just like homeowners do for mortgage payments. Banana Kelly has agreed to report rent information directly to the credit bureaus for those who choose to participate in the pilot.

In October 2017, Comptroller Stringer’s “Making Rent Count” report showed deep disparities in credit scores across the five boroughs. A shocking one in five New Yorkers do not have a credit score and nearly one-third of city residents have sub-prime credit scores, which puts a ceiling on financial success. Using never-before-analyzed data, the Comptroller’s Office found that in NYC communities where the average credit score is sub-prime, or below 630:

According to a 2015 study by the New York City Department of Consumer Affairs:

  • 78% of residents are renters
  • Black and Hispanic New Yorkers account for more than 90% of the population
  • NYCHA residents comprise one in ten residents.

While renters’ credit scores are often penalized by landlords, bill collectors, and others when they fall behind on payments, renters do not see currently a benefit to their credit scores for paying their rent responsibly and are not given credit for the largest check they may write every month. This pilot project aims to correct that imbalance.

Through an opt-in program, the Comptroller’s Office has found that adding rent to credit scores would grant a new credit score to approximately 30% of renters for the first time. Research by the Comptroller’s Office shows that adding rent to credit would either raise scores or add additional depth to credit files for 94% of projected participants who currently hold a credit score. Specifically:

  • More than half (57%) would see their score rise between 1 and 10 points;
  • Nearly one in five (19%) would have their score boosted by 11 points or more;
  • 18% would see no change at all;
  • 6% would see a minor decline in their scores.

“We’re facing an affordability crisis, and we all know how soaring prices and sky-high rents make life difficult for New Yorkers across the five-boroughs. One of the hidden roadblocks to financial success is credit – and access to it. This innovative new program empowers tenants, helps level the playing field, and reflects another step to unstack the economic deck. It’s breaking new ground – and it will help make our city fairer,” said City Comptroller Scott Stringer. “To tenants, our message is simple. If you pay your rent on time every month, this pilot could ultimately be a game-changer. At a time when we need to use every tool in the kit to make our city more affordable, this new pilot could be the start of something important. I cannot thank our partners at Banana Kelly enough for their efforts and their work. Their participation reflects just how committed its leadership is to moving New York into the future.”

“Too many of our residents and members are forced to pay inappropriate, even predatory , premiums for consumer goods and services that have become basic necessities in life. These costs place our residents at a disadvantage in so many aspects of daily life – applying for an apartment, applying for a job, buying a cell phone, entering into service contracts, and the list goes on. We are excited to pilot this project with New York City Comptroller Scott Stringer and look forward to seeing our residents establish credit and enhance credit – in short, to be given credit as credit is due,” said Harold DeRienzo, President of Banana Kelly Community Improvement Association, Inc.

The 27 buildings in the Bronx in which the program will be piloted fall within three zip codes. All three zip codes rank among the bottom 10 percent of zip codes across the city by median credit score. More than 40 percent of residents in of each zip code have subprime median credit scores between 600 and 610. Moreover, over 40% of residents in each zip code have “thin file” credit meaning they may have never had a credit score or are new or re-establishing their credit. Given the opportunity to boost their credit scores or obtain scores for the first time, many residents will see real financial benefits, including the potential to pay much less on auto insurance, credit card interest rates, loans, cell phones, or other bills.

To read the full October “Making Rent Count” report, click here.

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