App launches to build renters' credit
Paying a mortgage on time every month boosts your credit score, but paying your rent does not.
Toledo and Lucas County want to change that.
"Renters are typically lower-income, minorities, immigrants, and the communities we really want to serve and support," Samir Goel, co-founder of the app Esusu said.
Esusu, a saving and renting app, launched in Toledo on Thursday.
"If you have a poor credit score, national statistics show you can pay over a quarter-million dollars in interest rates over your lifetime," Goel's partner, Abbey Wemimo said.
Tenants can pay rent through the app, which reports the payments to the credit bureaus.
"I sent my kids to college. I bought a home. I plan to buy a home in Toledo with the savings I put into this club," Toledo Housing Commissioner Rosalyn Clemens said.
The original app is based on a susu, an ancient tradition of rotational savings. A group of people each put a set amount of money into a pot every week.
"It is pure savings. You put that money in before you buy a cup of coffee, before you buy a new dress, because you know you owe it to your peers in that group," Clemens said.
Every week, one person takes home the entire pot. In addition, the app reports your payments to the credit bureau, meaning your credit grows as your savings do.
"Fundamentally, we are stronger together than we are apart," Goel said.
Local partners plan on adding the app's features into their financial coaching. They will also encourage property owners to sign up, so their tenants can reap the benefits.