Most NYC renters are familiar with the challenges that come with paying rent on time. In between trying the city’s newest restaurants and rooftop bars, prioritizing our finances can feel like a fine art. One that can take a lot of discipline. And most youngsters don’t stop and think how their decisions could impact their credit score. Here’s the bad news- the ramen and the Bloody Marys are gonna have to wait. Because late rent payments affect your credit score!

So, what if your roommate is late paying rent, or if you’re falling behind on your own payments? Does this really have an impact on your credit score? Here’s what you need to know about sticking to the agreed-upon payment schedule.

What happens to your credit score if you don’t pay on time?

Right now, on-time rent payments don’t positively add to our credit score, while late payments can negatively affect our score. Seems a bit unfair, right? That’s why city comptroller Scott Stringer has been fighting to make rent count; arguing that renters should be allowed to add rent payments to their credit history, in the same way that home owners do for mortgage payments.

While it might not seem like a big deal if you miss one or two rent payments, there could be some consequences further down the line:

1. Late fees.

If your rental agreement includes a late fee clause, then expect to part with a few extra dollars if you’re late. Check your agreement, since the cut-off time could be a few seconds, or you may receive a grace period of a day or two. Either way, aim to pay on time every month, because paying the fee doesn’t automatically clean up your rental history.

Future rental applications.

When it’s time to move into a new apartment, your future property manager will want to know about your track record. They might use property management software or might contact your current landlord, but late payments are a red flag and could get in the way of being accepted to your new dream place.

Eviction risk.

Eviction laws vary by state, but you could find yourself with a notice of termination for cause in your hand, signifying the start of the eviction process. In such a case, you’ll usually be given a set number of days to pay the rent in full. If you fail, you might be kicked out – which has a huge impact on your credit score.

Poor credit score.

If your property management company reports late payments to credit score companies, your score will be impacted. 

Why does credit matter, anyway?

Your credit score is kind of like your passport to the consumer economy; a good credit score is your ticket to securing loans and mortgages in the future, when you need them most. Those with a low credit score (or missing one completely) could find themselves paying extra on their phone contracts, insurance and credit cards interest rates.

You could notice both short-term and long-term consequences, with late payments staying on your credit history for as long as seven years! 

You can request your credit reports online, to make sure yours are looking healthy.

What if you can’t pay rent?

Repeatedly missing payment deadlines is a big no-no, but we’re all human and sometimes the unexpected happens. If you expect that you’ll be short on funds for an upcoming rent payment, there are some things you can do. 

Talk to your property manager about short-term cash flow issues. Let them know the date you can make payment (as long as it’s only a few days after the deadline). They might just be able to let it slide – just this once. Remember, though, this isn’t the case for everyone. The best approach is to create automatic monthly bank transfers, so you don’t need to remind yourself to pay every month.

If this is an ongoing issue and you’re struggling to pay rent more than once, it’s time to make a change. Consider taking on an extra roommate, looking for a new source of income or moving to a more affordable pad.

D’you know what else Roomi does outside of helping its readers understand their credit score better? With our ever-increasing lists of rooms and roommates across the world, we help you find your perfect match! Download the app here and hop on the easiest ride home, ever!