Rent payments don’t typically affect your credit — but they can in a few circumstances. The consequences can be significant.

Rent doesn’t show up in your credit history, experts say because landlords don’t usually report payments to credit bureaus as credit card issuers and other lenders do.

When rent payments do appear, it’s generally because a tenant — or a property manager on a tenant’s behalf — has enrolled in a so-called rent reporting program. These services are meant to provide tenants with the opportunity to grow their credit history through on-time rent payments.

“The good news is that there are a lot of them out there,” said Matt Schulz, chief credit analyst at LendingTree. “It’s certainly been a growing space over the last few years.”

If you fall behind, however, those services can also hurt your credit, experts say. And whether you report your rent to the bureaus or not, debt collection efforts for late or unfulfilled rent payments can also be a black mark on your credit.

The Consumer Financial Protection Bureau began accepting complaints about rental debt collection in August 2023. Since then, there have been roughly 10,960 consumer complaints about rental debt collection in the U.S., per CFPB data through Feb. 21.

If you’re a renter or plan to be, here’s what you should know. 

Rent reporting can especially help those who are “credit invisible” or do not have any credit history. If you’re looking for ways to grow your credit, such platforms can be a helpful tool.

Those who have enrolled typically see their credit scores increase. When rent payments are included in credit reports, consumers see an average growth of 60 points to their credit score, according to a 2021 TransUnion report.

But if you fall behind on your rent payments, that activity could be also reflected in such tools, and in turn, your score, experts say.

What’s more, rent reporting services are not always free and do not always report the data to all three major credit bureaus, experts say. For example, rent reporting platform Rental Kharma charges $8.95 a month after an initial setup fee of $75. The service reports the data to two of the three bureaus: TransUnion and Equifax. 

The addition of any paid or unpaid collections tradeline — amounts of allegedly past-due accounts appearing on consumer credit reports — of at least $100 to a credit report will reduce a score of 680 by more than 40 points and a score of 780 by over 100 points, according to a 2014 report by the CFPB, citing the FICO 8 scoring model.

But the impact of a collection tradeline will depend on variable factors like your current score, the score model and even how recent the collection is, experts say. It could be less impactful once paid. 

“If the debt collection items are a few months old, that’s going to hurt a lot more than if it’s a few years old. It’s very variable,” Wu said.

Here are some key factors to keep in mind about how your track record as a tenant could affect your credit history, according to experts:

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“For some people, their credit may already be good. So it won’t make much of a difference, whereas for others, particularly those who have no credit history or a thin file, it could be very important,” Rust said.

2. Does the service cost anything? Some rent reporting services are free of charge, others require a fee that can range from $6.95 to $9.95 a month, according to Apartment List. Some services charge a one-time enrollment or setup fee that can cost from $25 to $95, the site found. See if it would come at an additional cost to you or if your landlord covers any of the fees.

3. Does the service report to all three major bureaus? It makes sense to confirm that the rent reporting services report your payment history to all three credit bureaus, Schulz said. Sometimes the service will report to one or two of the bureaus, but not all three — which can mean a limited or uneven effect on your credit.

“It’s something that people don’t always think about,” he said.

4. What data does the service report? Some only share on-time, in-full rent payments to credit bureaus while others might include late-payment activity, experts say. And even if they only report positive history, if you’ve paid on time for eight consecutive months and all of a sudden the record is blank, future landlords and lenders might be able to connect the dots, Wu said.

Also remember that “life happens,” she said. “Look at all of these federal employees that are out of a job right now. They didn’t think they were going to be late on rent either, and they had secure jobs.”

If you understand there is inaccurate or erroneous information on your credit report, you have the right to dispute that information under the Fair Credit Reporting Act, a law that governs credit reports, tenant screening reports and background checks, Wu said. 

“You have the right to dispute it,” she said. But keep in mind that it has been historically difficult to dispute reporting errors that involve debt collectors, Wu said. Creditors typically will take the side of the debt collector.

“It’s like a judge that always rules for the defendant or a referee that always makes the call for the home team,” she said. 

Even if you decide to ultimately pay the collection item on your credit report, with the exception of medical debt, it does not immediately go away, Wu said — it just appears as “paid.”

Under the provisions of the Fair Credit Reporting Act, adverse information like debt collections may remain on your credit report for seven years.

In 2022, the three credit bureaus announced voluntary changes to remove some medical debt from credit reports, which included paid off medical debt and unpaid debt under $500, Wu said. 

Outside of that, the item stays as a “ding” on your credit report even if you pay. 

“So paying it off might not solve the problem,” she said. One thing you could do is “pay-for-delete,” or pay the debt collector for them to kick the collection line off your credit in return, she said. If you decide to go through this route, make sure to get the agreement in writing, Wu said. You may want to consult legal experts about the idea.

Similar to your landlord — if you’re going to end your lease early, and you get the landlord’s “OK,” get the agreement and any details on your outstanding balance or obligations in writing.

With a population of about 2,100, Neodesha, Kansas, is roughly 100 miles from Wichita and Topeka in Kansas and Tulsa, Oklahoma. Its claim to fame is the 65-foot-tall tower that supported the drilling framework for the first commercial oil well west of the Mississippi River, locals say. 

But as an old oil town, Neodesha has struggled with a decreasing population and an aging housing supply for years.

When the refinery formerly owned by Standard Oil Co. closed in 1971, “the population was cut in half over night,” according to Neodesha’s mayor, Devin Johnson.

“We have seen that decline as every small community has over the last 50 years,” Johnson said. “The thing with small communities is, if you are not growing, you are dying.”

Last year, Neodesha partnered with MakeMyMove, an online relocation marketplace that connects workers with communities trying to attract new residents.

The town is now offering qualifying new residents incentives — such as waiving state income tax through 2026 along with property tax rebates and help with day care for working parents — as well as access to existing perks, including student loan repayment assistance up to $15,000 and free college tuition through the Neodesha Promise scholarship program.

MakeMyMove, which has worked with 88 communities across the U.S., screens applicants and connects them with local resources.

Since the program launched in 2024, more than 30 people are in the process of moving to Neodesha, according to Evan Hock, MakeMyMove’s co-founder and chief operating officer.

“We’ve awarded over $1 million in scholarships, and I feel like we are helping the community and making some real progress,” said Ben Cutler, who grew up in Neodesha and now funds the scholarship program, which started in 2020 and is available to any graduate of Neodesha High School in good standing. (Neodesha’s promise program will cover tuition at participating colleges or associate degree programs and vocational schools nationwide.) 

“One of my key focuses was helping build the community, to help in any way I could to make Neodesha a more attractive community for young families, and I think we’re making some real progress in that regard — I certainly hope so anyway,” Cutler said.

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Meanwhile, efforts are also underway to construct hundreds of new homes, apartments and duplexes in the region, along with the development of retail and commercial spaces and the renovation of several historic buildings on Main Street.

“We’ve got to cherish what we’ve got but make sure we make Neodesha an attractive place for people to come,” Johnson said.

Other communities across the country have also been upping the ante with cash incentives or voucher programs for people willing to move.

For example, workers relocating to Topeka can receive up to $10,000 for rent for the first year or up to $15,000 to put toward buying a home.

Another program affiliated with the West Virginia Department of Tourism is offering a cash incentive of $12,000 along with access to free coworking spaces and outdoor recreation packages for those who move to the state for at least two years.  

The Shoals Economic Development Authority offers $10,000 in cash to full-time remote employees who are willing to relocate to the Shoals community in northwest Alabama.

“This is a cost-effective way of doing economic development,” said MakeMyMove’s Hock. The communities “usually get a return within the first year.”

However, “incentives are not the reason people actually move,” he said. Affordability is key, he said, but community also plays an important role.

“They are looking for quality of place, they want a community connection, that’s what is motivating the move,” Hock said.

Incentive programs in Neodesha and other regions are gaining steam as residents from major cities across the country increasingly migrate to Southern and Midwestern spots where housing costs are less severe, and where construction is keeping up with the demand, reports show.

United Van Lines’ annual 2024 study found a growing shift away from the cities and suburbs of New York, Los Angeles and Chicago toward more “livable” locations with lower day-to-day living expenses.

Kaitlyn Sundberg never expected that she would move to Kansas. Sundberg and her husband, Jack, lived in Southern California but struggled to save enough for the down payment on a home of their own.

“We were living with my in-laws, and we were not able to afford anything,” said Sundberg, 27.

Sundberg’s husband, who worked as an estimator for a telecom company, expanded his job search — significantly — and found an opportunity as the program manager for Southeast Kansas Inc.

When they visited Neodesha, “it just seemed like a family-friendly place to live,” Sundberg said.

“We spent a Saturday looking for a house — there were kids riding bikes,” she said, “I just cried.”

The couple moved to Neodesha with their two dogs 18 months ago, even before the incentive program launched. Sundberg now works as the executive director of the new early learning center in town after a neighbor brought over the job posting and suggested she apply for the position.

“Being away from family is the hardest part,” she said, “but I would never want to move back.”

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Social Security has never missed a benefit payment since the program first began sending individuals monthly benefits more than eight decades ago.

But the recent actions at the U.S. Social Security Administration by Elon Musk‘s so-called Department of Government Efficiency are putting monthly benefit checks for more than 72.5 million Americans at risk, former commissioner and former Maryland governor Martin O’Malley told CNBC.com.

“Ultimately, you’re going to see the system collapse and an interruption of benefits,” O’Malley said. “I believe you will see that within the next 30 to 90 days.”

Ahead of any interruption in benefits, “people should start saving now,” O’Malley said.

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The Social Security Administration uses multiple systems and technologies that Elon Musk has criticized for leading to errors. As commissioner, O’Malley told Congress the agency needed more funding for IT modernization.  

O’Malley said DOGE leaders are now making changes at the agency, and significant staff cuts have already led to system outages. Those intermittent IT outages may happen more frequently and for more extended periods of time until there is a “system collapse and an interruption of benefits,” he said.

Neither the Social Security Administration nor the White House responded to requests for comment by press time.

The Department of Government Efficiency, also known as DOGE, is not a federal department. And Musk, whom President Donald Trump brought on board to implement DOGE, is not an elected official.

Since its establishment, DOGE has looked to slash spending at federal government agencies.

The cuts have led to leadership upheaval, with the recent resignation of acting commissioner Michelle King following a reported disagreement over DOGE’s access to sensitive data. O’Malley resigned from the Social Security Administration in November to run for chairman of the Democratic National Committee, a race which he lost to Minnesota Democrat Ken Martin.

Trump has nominated Frank Bisignano, CEO of financial-technology company Fiserv, to serve as the new commissioner of the Social Security Administration. Bisignano has yet to sit for Senate confirmation hearings.

In the interim, Lee Dudek, who first joined the agency in 2009, has been appointed acting commissioner.

Earlier this month, Dudek posted on LinkedIn that he had been placed on administrative leave from the agency for helping DOGE representatives, The Wall Street Journal reported on Feb. 20.

“Our continuing priority is paying beneficiaries the right amount at the right time, and providing other critical services people rely on from us,” Dudek said in a Feb. 19 statement about his appointment.

On Thursday, the Social Security Administration sent a notice to employees that gives them until March 14 to decide whether to take an early buyout. Unlike a previous January offer, this now includes service employees, and staffing reductions in that area may impact how quickly the agency processes benefit claims and provides other services, Hornick said.

For example, if a woman files for a survivor benefit after her husband passes away, she needs to provide a copy of her marriage license. A Social Security employee then needs to code the system to verify they have seen that document and the applicant is eligible for benefits, Hornick said.

“Not everybody can do things electronically,” particularly the older adults and disabled individuals who the Social Security Administration serves, said Maria Freese, senior legislative representative at the National Committee to Preserve Social Security and Medicare.

“If you don’t have people to run an agency that requires hands-on customer service, then of course there’s a risk that you could end up with benefits being either denied or interrupted,” Freese said.

The DOGE savings web page has a list of about 45 Social Security locations where leases will be terminated, according to Rich Couture, spokesperson for AFGE SSA General Committee, a union that represents 42,000 Social Security employees nationally.

The list provides little information on the uses for the locations that are being closed. Based on the square footage listed, they may be sites used to conduct in-person hearings for disability benefits, Couture said. In one case, the location seems to be a busy New York state field office that provides general services, he said.

“If they’re going to close these offices that are busy in highly populated areas, it would suggest to me that there’s no office in this country that would be safe from having a lease terminated, especially in rural areas,” Couture said.

In a recent statement, Rep. John Larson, D-Conn., said the moves are a “backdoor benefit cut.”

“Let me be clear — laying off half of the workforce at the Social Security Administration and shuttering field offices will mean the delay, disruption and denial of benefits,” Larson said.

In a statement to CNBC.com earlier this week, the Social Security Administration said it has not set any reduction targets, in response to reports it plans to cut 50% of its employees.

As a union, AFGE has been issuing bargaining demands in response to the agency’s recent decisions and plans to enforce employee rights through other methods as necessary, spokesperson Couture said.

While many lawsuits have been filed, it will take time to work through them, especially as the courts are now being flooded with cases tied to the Trump administration’s actions, said Nancy Altman, president of advocacy organization Social Security Works.

The biggest results may come from the pressure American voters could put on elected officials, former SSA commissioner O’Malley said.

“I think many people throughout the country are going to start bringing a lot of heat to members of Congress who have been facilitating, supporting, aiding and abetting the breaking of their Social Security and the interruption of benefits that they work their whole lives to earn,” he said. “These are earned benefits.”