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Renting & late fees survey: What Roost members say

Why renters pay late and where they turn for help

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Roost recently surveyed members about their financial situation and how often they had to pay rent-related late fees. We wanted to better understand how renters were faring given COVID, rising housing costs, and record-breaking inflation trends. What we found: Most renters continue to struggle to get ahead, smooth out cash flow, and improve their financial health.

Paying rent late is common & costly

Nearly 25 percent of all renters surveyed missed a rent payment or paid late at least once in the past 12 months. Of those who paid late at least once, 62 percent did so more than once. 

In the best-case scenario, renters paid $50 in late fees just once. But renters with higher late fees who paid late five times forked over a whopping $1500. 

With 63 percent of Americans living paycheck-to-paycheck, inconsistent cash flow or an unexpected expense can make paying rent on time difficult—and costly. 

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Why renters pay rent late

 

Contrary to popular belief, COVID wasn’t the primary cause of paying rent late. Juggling income with expenses and an unexpected bill were the most common reasons renters missed a rent payment or paid late.

“Not having enough money to cover an expense is often just one of a series of financial setbacks. A mismatch in cash flow can quickly lead to compounding costs,” Chanin Ballance, CEO, Roost, says. “Let’s say you’re a freelancer who is waiting on a late payment from a client. If that late payment leaves you short on cash to cover rent, you’re likely facing a five percent late fee. If you were signed up

Twenty-eight percent of respondents had paid a bank overdraft fee at least once in the past 12 months, and 25 percent had been late or missed a credit card payment. 

High-interest credit – where renters turned for help

According to a survey conducted by Bankrate, 56 percent of Americans are unable to cover an unexpected $1000 bill with savings. These numbers are potentially even worse for renters: A Roost renter survey conducted last year found that just 62 percent consistently had $300 or more in savings. 

So, where do renters turn when they need help? Only 30 percent were able to rely on friends and family for financial assistance. The rest turned to higher-cost options, from credit cards (41 percent) to payday loans (4.5 percent). 

Most renters want to improve their credit score

Without a solid credit history, borrowing from traditional lower-cost lenders isn’t an option. This means many people must turn to more costly sources and pay more fees.

The majority of survey respondents wanted to improve their credit score—just 18 percent indicated this wasn’t a focus within the following year. Additionally, while 62 percent of those surveyed knew that reporting their rent payments to improve their credit score was an option, just 10 percent were actively doing so.

Without a solid credit history, borrowing from traditional lower-cost lenders isn’t an option. This means many people must turn to more costly sources and pay more fees.

The majority of survey respondents wanted to improve their credit score—just 18 percent indicated this wasn’t a focus within the following year. Additionally, while 62 percent of those surveyed knew that reporting their rent payments to improve their credit score was an option, just 10 percent were actively doing so.

What’s your FICO score

Next steps: Improve long-term renter financial health

Roost’s survey indicated that renters struggle to build enough savings to weather unexpected expenses and often turn to high-interest credit for help. This can cause a vicious debt cycle that not only creates financial instability but housing instability, too. Identifying low-cost ways for renters to smooth out cash flow, strengthen their credit, and build savings will help both properties and tenants reduce costs and avoid fees.

Want a copy of the survey results infographic? No problem! Email us to get in touch.

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A quick note! Our goal is to gather and share info that’s up-to-date and helps you make great decisions as a renter. That said, the information you get directly from a provider could be a little different. Make sure to review their terms and conditions directly; and, if you see anything here that needs to be updated, please let us know! Advertising disclosure
Last Updated: September 9th, 2024
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