Why You Should Pay Your Rent on Time... and How to Check to Make Sure Your Rent is Legal

Published on Jan 27, 2012

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If you want to avoid a series of (escalating) problems, it's important that you pay your rent on time.  Every month.  First and foremost, the lease you signed is a legally binding contract.  That, in and of itself, should be reason enough. However, if for some reason you feel like you need an additional incentive...

There are other obvious reasons you should pay your rent on time: your landlord will like you more than if you don't pay your rent on time, putting yourself in a relatively better position to negotiate come lease renewal time; you won't be charged late fees (remember though: late fees are only allowed IF it's stipulated in your lease) or face eviction; and you'll feel like a good citizen and responsible adult. All indisputably true.

It's also not fair to the landlord if you don't pay on time. He/she needs your rent check to run their business... you are their income.  Would you appreciate it if your employer withheld your income a few days, or a week, beyond when you were supposed to be paid?  I thought not. Remember, not every landlord is rich, or has lots of extra cash they can depend on if you don't pay your rent on time.

But now add another reason residents of NYC rental apartments should make every effort to pay their rent on time: it now goes on your credit rating.

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Yes, according to a recent report in the New York Times, Experian, one of the three biggest credit-reporting companies in the country, last year quietly added on-time rent payments to their profiles, which boosted the credit scores of a surprising number of people, especially those who don't have a lot of other data in their file to begin with, such as student loans, car payments, mortgage payments, etc.

And chronic late-payers be warned: THIS year Experian will start including negative rental apartment behavior--like bounced rent checks and even unauthorized lease-breaking--into their scoring. And two other credit-report companies, CoreLogic and FICO, are following suit.

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But what if you think you're rent is too high? As in, illegally high?

Here's the thing: if your NYC rental apartment building has more than six units and was built before 1973, chances are good that it is now, or once was, a rent-stabilized building. Now, there are plenty of ways landlords can legally "destabilize" their buildings (or specific units)--by performing significant improvements, for example--and charge whatever they want, but you should know that just because your landlord says your rent is such-and-such, that doesn't necessarily mean that such-and-such is legal.

It's easy to find out your specific situation: all you need is your NYC rental apartment's "rent history", which, as EV Grieve reveals, you can get by calling 718-739-6400, speaking to an operator, and ask for it, back to 1984.

You'll receive a record in the mail in a few days. In rent stabilized buildings (or units), landlords are only allowed to raise your rent according to the increases determined every year by the NYC Rent Guidelines Board, or by no more than 20% in the event of tenant vacancy.

Remember, not all buildings (or all units in a building) are rent-stabilized.  If the building or the specific unit you live in is not rent-stabilized, the landlord is free to charge whatever they feel the market will bear. But if you don't ask, you don't know.

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