Key Takeaways:
– Boom has developed a new product called “Rent Reporting-as-a-Service” that allows large-scale property management platforms and rent payment gateways to embed its payment reporting module.
– This update makes rent reporting easier and more efficient for landlords, reducing the need for third-party systems and encouraging more property managers to promote it to tenants.
– Boom is one of the few systems that reports to all three major credit reporting agencies: TransUnion, Equifax, and Experian.
– The company’s CEO stated that their original industry data partners were not able to scale at the pace they desired, leading them to develop their own solution.
– Boom’s rent reporting API offers various benefits, including in-time and delinquent payment reporting, rent history collation, and integration with lease workflows.
– Rent reporting is becoming more popular in the rental industry, with many proptech companies adopting it to help landlords provide benefits to tenants.
– Consistent rent payments have traditionally been overlooked as a creditworthiness indicator, but this practice is gaining importance for lenders in the home loan qualification process.
– Rents have been declining for five consecutive months, according to a recent report.
inman:
Boom’s new product will allow virtually any large-scale property management platform or rent payment gateway to directly embed its payment reporting module for faster, simpler reporting of tenant payment records.
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A technology company that automates how landlords report tenant payments to the three major credit reporting agencies has scaled its product to meet the integration needs of enterprise-level property management systems, Inman learned in an exclusive press release.
Boom is rolling out what it calls “Rent Reporting-as-a-Service,” an API (application programming interface) that will allow virtually any large-scale property management platform or rent payment gateway to directly embed its payment reporting module.
The benefits of Boom’s update are many, but users should primarily laud it for how it bolsters rent reporting as a standard practice for landlords. Not having to connect payment processes to a third-party rent reporting system greatly reduces friction in the process and should encourage more property managers to promote it to tenants as a leasing incentive.
Austin, Texas-based Boom is one of the few systems that reports to all three bureaus, TransUnion, Equifax and Experian. It also has its own solution for direct rent reporting, Boom for Property Managers.
In the press release, the company’s CEO and co-founder Rob Whiting said that its original industry data partners weren’t capable of helping them scale at the pace the company was seeking.
“It was fine to start,” Whiting said of the industry-standard data furnishers. “But it didn’t scale with enterprise-level volumes.”
“Because each credit bureau handles rental data differently, we worked closely with the teams at each bureau to define the approach, with strong validation from our bureau partners,” he said.
Whiting said that Boom’s solution addresses an industry-wide issue with adopting rent reporting software and that industry software vendors were coming to them frustrated by all the data link-ups required to send accurate tenant payment data to each bureau.
“In launching Rent Reporting-as-a-Service, we saw an opportunity to solve an industry-wide problem while expanding renter access to credit building with rent.”
More proptechs operating in and around the rental industry, with the help of fintechs, are adopting rent reporting as a way to help landlord users pass on a benefit to tenants. The practice emerged, according to Boom, as a result of fintechs’ collective increase in financial data handling and security and the Federal Housing Finance Agency’s support of pending changes to credit score modeling for loans being sold to Fannie, Freddie and other Government Sponsored Enterprises (GSEs).
Investopedia.com defines a GSE as “a quasi-governmental entity established to enhance the flow of credit to specific sectors of the U.S. economy.“
Boom, which landed $4.5 million in seed funding this past summer, said its rent reporting API will help PMSs send in-time and delinquent payments, collate rent history, plug-in rent reporting authorizations into lease workflows and enable landlords to adjust costs (if included) and pass-through product support, among other benefits.
The product can be up and running in a few weeks and can fit into a wide array of existing tech stacks.
Consistent payments to landlords have long been neglected as a sign of creditworthiness, which is most lenders’ primary decision-making tool for a home loan once a person reaches the level of qualification. Many renters are homebuyers-in-waiting, pushed to the periphery of the market after post-pandemic market trends led to higher rates and reluctant sellers.
Inman reported this week that rents have declined for the fifth consecutive month.
According to a report released Monday by Realtor.com, rents for studio, one-bedroom and two-bedroom units fell 0.7 percent between August and September, with median rents in the 50 most populous United States cities hitting $1,747, down $29 from the peak seen in July 2022.
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Property Chomp's Take:
Boom, a technology company that automates how landlords report tenant payments to credit reporting agencies, has announced a new product that will simplify and streamline the reporting process. The company's "Rent Reporting-as-a-Service" API will allow large-scale property management platforms and rent payment gateways to directly incorporate Boom's payment reporting module.
This update is significant because it enhances rent reporting as a standard practice for landlords. By eliminating the need to connect payment processes to a third-party rent reporting system, the API reduces friction and encourages more property managers to promote rent reporting as a leasing incentive to tenants.
Boom is based in Austin, Texas, and is one of the few systems that reports to all three major credit reporting agencies: TransUnion, Equifax, and Experian. The company also offers its own solution for direct rent reporting called "Boom for Property Managers."
According to Boom's CEO and co-founder Rob Whiting, the company's original industry data partners were unable to keep up with the company's rapid growth. Whiting explained that each credit bureau handles rental data differently, so Boom worked closely with each bureau to define the approach and ensure a seamless integration.
Whiting also highlighted the industry-wide issue with adopting rent reporting software, as vendors were frustrated by the complexity of linking up accurate tenant payment data to each credit bureau. Boom's Rent Reporting-as-a-Service solves this problem while expanding renter access to credit building opportunities through rent reporting.
The product offers several benefits to property management systems, including the ability to send in-time and delinquent payments, compile rent history, integrate rent reporting authorizations into lease workflows, and provide landlords with the flexibility to adjust costs and receive product support.
Boom's API can be implemented in a few weeks and easily integrated into existing tech stacks. This streamlined process will help landlords and property managers establish consistent rent payment records, which are often overlooked as a measure of creditworthiness. Many renters aspire to become homeowners but face challenges due to higher rates and a competitive market. Rent reporting can help these individuals build credit and improve their chances of qualifying for a home loan.
The adoption of rent reporting by proptech companies operating in the rental industry, with the support of fintechs, has become increasingly common. This trend is driven by the increased handling and security of financial data by fintechs and the Federal Housing Finance Agency's endorsement of changes to credit score modeling for loans sold to Fannie Mae, Freddie Mac, and other Government Sponsored Enterprises. Rent reporting is now seen as a valuable tool that benefits both landlords and tenants.
Boom recently secured $4.5 million in seed funding, demonstrating the growing interest and investment in rent reporting solutions. With its Rent Reporting-as-a-Service API, Boom aims to simplify the process of reporting tenant payments and make rent reporting a widely adopted industry practice.
As the rental market continues to evolve, rent reporting will play an essential role in helping tenants build credit and access better financial opportunities. Boom's innovative solution is poised to revolutionize the way rent reporting is implemented and integrated, benefiting both landlords and renters alike.
