Any payment account that is not found in your Equifax*, Experian*, or TransUnion* credit report is considered “alternative” credit. Typically, property managers and landlords, utility companies, cell phone providers, insurance companies and many other types of businesses do not report their customer’s account information and payment history to the national credit bureaus.
Regardless of whether you have no credit file, a thin credit file, or a credit file with negative credit information, your alternative credit information may help you in many situations that require a credit check. If you have no credit file or a thin credit file with no score, and you make on-time monthly payments, your alternative credit accounts may help you establish a payment history that will help you build or improve your credit score(s). If your credit file contains negative payment information, your alternative credit accounts may help to offset those negative marks by showing the creditor a more complete picture of your credit history. Even if you have good credit, but only one or two accounts, your alternative credit accounts may further lift your overall credit profile by demonstrating across more accounts how conscientious you are about making timely payments