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Credit information: Credit building misconceptions

Renters may not realize that paying promptly may not be enough to help them build strong credit, according to The Washington Times.

While it is true that paying on time is an important part of improving a credit rating, the source notes, experts state that many tenants may not be aware the type of account being used is also important.

Credit reports and scores generally do not track rental payments, although such information is being looked at more commonly now than in the past. It is often tracked separately, however, and may not be revealed by a landlord's common tenant screening efforts.

Auto loan payments, credit card use, student loans and other financial records go into credit reports and scores, according to the Times. The impact they have can vary by how recent they are, how long they lasted and other circumstances.

Rent, on the other hand, may not always be reported. When it is, it is frequently a bad sign, occurring because rent payments are late or even delinquent and going into collections. In that sense, prompt rent payments can contribute by avoiding a negative impact on credit records and scores.