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New California law allows tenants to report positive rental history

Posted 4:24 AM, Apr 01, 2025

BAKERSFIELD, Calif. (KERO) — Starting April 1st, landlords with units above 16 must allow tenants to report positive rental payments to credit bureaus.

  • This law aims to help tenants, especially those new to the market, build their credit history.
  • Landlords may charge a fee for reporting, but cannot exceed $10 or the actual cost incurred.
  • The law could lead to complications for tenants with existing bad credit who choose not to opt-in.
  • Officials are monitoring the law's impact as it is implemented.

BROADCAST TRANSCRIPT:

Starting April 1st, landlords who rent out 16 or more units must offer tenants the option to report their positive rent payments to one or more of the major credit bureaus.

Peter Chang states, "If you are a new person to the market, then over you get your first rental, you're going to have credit history because if you decide to opt in, it's going to be part of your credit history."

This bill makes it easier for those starting who opt in and have no credit history to build credit toward buying a house, car, and other things they dream of buying. But what happens if you have a bad credit history?

Peter Chang raises a concern, "Will you be sort of discriminated against because you decided not to opt in? That's an unintended consequence of this type of rule." R

renters should be aware, however, that if they choose to have their rental payments reported, landlords can collect a $10 fee or the actual cost of rent reporting.

Peter Chang clarifies, "Let's say a credit agency requires them to pay 15 or 50 dollars a month per tenant. The landlord cannot pass along that cost except up to the maximum of 10 dollars.

" With that extra added expense, which is a protection fee, you can expect your landlord to notify you with instructions on how to opt in or out on your next renewal or if you switch to a new apartment.

Peter Chang adds, "If you have a landlord in their reporting, that may make it more difficult for you as a tenant; it may make it more difficult for you to correct the credit report."

Though this bill does have positive and negative implications, officials tell me they are waiting to see how this bill plays out as it takes effect April 1st.


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