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Credit Report May be Hurt by Joint Lease and Utilities

Dear Experian,

My daughter is in the process of looking for a new apartment and obtained a copy of her credit report. She found her credit is “fair.” She also found her roommate’s name, Social Security number, rental history and other information listed on the report. This was quite shocking to my daughter. She is very upset. They each signed a year’s lease which expired a few months, ago. They are now on a month-to-month basis. She knows her roommate is frequently delinquent on her bills. In particular, she knows this is true in regard to their monthly rent. My daughter pays her portion on time. Why is my daughter’s roommate listed on my daughter’s credit report? What part of the roommate’s financial life, if any, comes into play on my daughter’s credit score? How long will the roommate’s financial history and habits reflect on my daughter’s report? How can my daughter become a single entity as far as her credit is concerned?

– RBH

Dear RBH,

Rental history is not typically part of a credit report, so your daughter may be looking at a specialized rental history report that she obtained as part of a rental application process. A credit report may be included with the overall report, but other types of consumer reporting agencies compile the other information that it contains.

If it is indeed on her credit report, she can and should provide proof of her ID and have all of her roommate’s identifying information removed. She can find out by requesting her reports at www.annualcreditreport.com.

If only the roommate’s identifying information is on her credit report, it will not affect her credit or her credit scores. However, she should consider some other issues that may not yet be affecting her, but could in the future.

It is not likely that the landlords will report late payments to the credit reporting companies, but they very likely will report to consumer reporting companies that collect data on payment of rental and lease agreements. This could affect your daughter’s ability to rent a new apartment.

If the roommate fails to pay, the apartment complex management company could turn the debt over to a collection agency and they would report the account to the credit reporting companies for all the names associated with the account. The same thing is true of utility and telephone accounts.

So, the important message to your daughter is that if her name is on any account, she is fully responsible for the entire account. She needs to be able to communicate openly and frequently with her roommate about shared obligations and to make sure that the rent and utilities are paid as agreed. Otherwise, she needs to find a new roommate.

Also, your daughter needs to be sure that her name is removed from the lease contract and all shared phone and utility accounts when she moves out and that all those accounts are in a paid status.

The only other question is whether or not the roommate shares credit accounts with your daughter, or has used your daughter’s identity to apply for credit. That should be evident in your daughter’s credit report.

She will need to either close those accounts or have the lender remove her name from those accounts to ensure her credit history is not affected by her roommate’s use of those accounts.

Thanks for asking.
The “Ask Experian” team

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