What Happens to Your Credit Score if You Pay Your Rent Late?

Here's what to expect if your rent payment isn't made on time.

When you sign a lease to rent a home, your rent is generally due by the first day of each month. Normally, if you're a few days late on your rent, it's not a big deal. That's because most lease agreements have a grace period, where you're technically allowed to pay your rent by the third, fourth, or fifth day of the month without penalty or negative consequences. But a late payment beyond that point could result in a late fee -- and also put your credit score at risk.

Will a late rent payment hurt your credit score?

If you're late on a mortgage payment, you can count on it hurting your credit score. But what about being late on a rent payment? The impact there is a little complicated.

For one thing, not all landlords report rent payments to the credit bureaus that put together your credit reports. That can be a good thing and a bad thing. If you're timely with your rent payments, that activity could help boost your credit score. But if you're late with your payments, it could hurt your credit score.

Even if your landlord does report rent payments, some credit score models don't include rent payments in their calculations. If you run into a situation where you're late with your rent, your landlord reports it, and it's used in calculating your credit score, you could see that number drop substantially.

There's no specific number you can expect your score to drop, because that will depend on the scoring model at hand and what your credit score looked like before your late payment. Believe it or not, the higher your credit score is to begin with, the more of an impact a late payment might have. As such, if you're late with a rent payment, you should brace for negative consequences.

What to do if you're late with a rent payment

There are different reasons why you might be late with a rent payment, stemming from sheer forgetfulness to a lack of money to pay your landlord. If you run into the former situation, aim to rectify it at once. Make your payment as soon as you remember and ask your landlord not to report you as late. If you're generally timely with your payments, your landlord will likely cut you some slack -- especially if this is your first offense.

If you're late paying rent because you don't have the money, rather than just not send that check, contact your landlord and explain your predicament. Maybe your hours just got cut at work, or you've run into a temporary financial crunch. If you're a tenant in good standing, your landlord might give you more time to pay without negative consequences.

Being late with a rent payment could impact your credit score. Beyond that, it could also result in a late fee, depending on the terms of your lease, and get you on your landlord's bad side. That's not a good place to be if your lease is coming due and you're hoping to renew it. Granted, a single late payment may not cause your landlord to deny you a renewal, but you're better off not taking that chance. Instead, do your best to either pay on time or be proactive in communicating with your landlord.