Why Alernative Data Beats Credit Scores

Introduction

For years, credit scores have been the go-to metric in rental screening. But they weren’t designed for leasing decisions—and they often leave out a wide swath of financially responsible renters. At Rent Butter, we believe there’s a better way. By leveraging alternative data like bank activity and rent payment behavior, we help property managers get a clearer, fairer picture of applicant reliability.

Credit scores measure risk from a lending perspective. But renting isn’t lending—it’s housing. That distinction matters when you’re evaluating someone’s ability to consistently pay rent.

The Limits of Traditional Credit

A chart comparing credit score coverage vs. banking data coverage
Millions of Americans don’t have a traditional credit score, or their score doesn’t reflect their current financial behavior. This is especially true for gig workers, students, immigrants, and people rebuilding credit.

Credit reports can miss:

• Recent income changes
• On-time rent payments
• Non-traditional income (like freelancing or benefits)

That means qualified renters are sometimes denied, while others with higher scores may still pose risk due to outdated or misleading data.

Alternative Data Tells the Full Story
Rent Butter uses live bank data—shared securely and with consent—to evaluate applicants based on:

• Income consistency
• Rent-to-income ratio
• Spending behavior
• Historical rent payments

This dynamic approach gives property managers deeper insight into an applicant’s real-world ability to pay rent. It also widens the pool of eligible renters without compromising risk controls.

"We’ve seen applicants get approved with confidence—even without a strong credit history—because the data supports their reliability."

More Inclusive, More Effective
Rent Butter uses live bank data—shared securely and with consent—to evaluate applicants based on:

By moving beyond credit scores, Rent Butter supports a more inclusive and effective screening process. Operators gain:

• Faster decision-making
• Fewer false declines
• Better occupancy outcomes

And renters benefit from a process that values real-life financial behavior—not just a three-digit numb

Conclusion

Credit scores aren’t going away—but they shouldn’t be the only voice in leasing decisions. With alternative data, Rent Butter empowers property managers to screen smarter, faster, and more fairly.

Want to see how alternative data works in action? Schedule a demo