Dear Penny: Does Paying HOA Fees On Time Boost My Credit Score?
I have paid a hefty HOA fee monthly for years almost always on time. My question is: Can this help increase my credit score, and, if so, what do I need to do?
— Paid-Up Homeowner
Dear Paid-Up,
Whether or not something impacts your credit score depends on whether it’s included in your credit report. To show up there, someone must have reported it to a credit bureau.
Homeowners associations have only been able to report HOA assessment payments and delinquencies since 2016, when the data aggregation company Sperlonga Data and Analytics began facilitating the reporting, according to a 2016 memo by Oscar Marquis, a highly regarded lawyer and government advisor in the consumer reporting industry. According to Sperlonga, HOAs can report on-time, late and missed payments to TransUnion and Equifax, but only late or missed payments to Experian.
HOA boards still have ultimate authority to determine whether or not to report assessment payment histories for their members or not. You can find out whether your payments are being reported by:
- Asking your HOA board about their reporting practices. Do they report anything? If so, do they report on-time payments or only late or missed payments?
- Checking your credit reports through AnnualCreditReport.com or an app like Credit Karma or Credit Sesame. Do you see your HOA payments or delinquencies listed?
HOA assessment reporting will only help your credit score if your HOA reports on-time payments. If it reports late or missed payments, those could hurt your credit score just like any unpaid bills or debts.
If you discover your HOA isn’t reporting on-time payments, you could work with other members to request that they start. This decision will impact everyone: You can’t just ask the board to report your payments, because it’s required to provide the same reporting for all members, according to Sperlonga. You can’t personally report your payment activity, so you’ll be subject to whatever your HOA board decides.
Dana Miranda is a Certified Educator in Personal Finance® and author of YOU DON’T NEED A BUDGET. She writes Healthy Rich, a newsletter about how capitalism impacts the ways we think, teach and talk about money.
