- Homeowners who fail to pay their HOA dues in a timely manner are now also risking their credit score, just as they would with a late mortgage payment.
- Sperlonga Data & Analytics agreed to become the first company to furnish homeowner association payment and account status information to Equifax, one of the three largest credit bureaus.
- While the percent of available credit and your on-time payment history are the two of the most important factors, the partnership between Sperlonga and Equifax joins a number of other surprising things that can affect your score.
When you look outside and see maintenance diligently shoveling when it’s below zero or expertly manicuring the lawn that you barely have time to mow, you might thank your lucky stars for that homeowners’ association (HOA). Whatever a housing community’s perks may be, paying dues to the HOA can be well worth the manual labor saved and peace of mind.
But the accompanying costs, which can range from a couple hundred dollars to more than $1,000, weigh heavy on the checkbook and sometimes impose strict rules and seemingly arbitrary fines — whether it’s for pouring mulch of the wrong color shade or “planting an unauthorized flower.” It doesn’t take much for the blessed HOA to join your hit list.
In the past, those who defaulted on their HOA fees — in protest or because they found themselves financially strapped — might face eventual foreclosure, liens, garnishee wages, cut-off utilities or a friendly visit from the collection agency.
Now, for the first time, homeowners who fail to pay their HOA dues in a timely manner are also risking their credit score, just as they would with a late mortgage payment.
Sperlonga Data & Analytics partners with Equifax
This month, Sperlonga Data & Analytics, a data aggregation business for alternative credit data sources, agreed to become the first company to furnish homeowner association (HOA) payment and account status information to Equifax Inc., one of the three largest credit bureaus.
“Until now, HOA payments have gone largely unreported to the national credit reporting agencies,”said Matt Martin, chairman and founder of Sperlonga.
“Our service will help elevate association payments to the same level of importance as the consumer’s other financial obligations like residential mortgages, auto loans and credit card payment.”
Martin added that property owners who are never late on their payments should start to see a positive impact on their credit reports, the same way they would with other traditional payment histories.
“Associations and property management companies should begin to see reduced delinquencies and improved cash flow. Our goal is to empower homeowner associations and management companies with the same credit reporting tool that banks and lenders already use to manage consumer debt and credit-related payments,” he said.
The Irvine, California-based Sperlonga was founded in 2011 with the goal of providing tech solutions to HOAs and the residential mortgage industry to help stakeholders mitigate loss and increase cash flow.
Alternative sources of credit data
The strength of your credit score can significantly impact buyers’ ability to obtain a home loan and the quality of that loan. While the percent of available credit and your on-time payment history are the two of the most important factors, the partnership between Sperlonga Data & Analytics and Equifax joins a number of other surprising things that can affect your score, including:
- utility and cable bill payments
- late library books
- renting a car
- closing an account
- holding credit cards but not having any loans
“Equifax is committed to providing consumers with additional means for building their credit histories. Introducing new sources of data beyond what has traditionally been found on credit files can provide additional insight into a consumer’s financial behavior and help deliver expanded credit access,” said Mike Gardner, senior vice president and sales leader at Equifax.