Thinking of Sending Unpaid Rent to Collections? Think Again!

Being a landlord or property manager comes with its own unique set of challenges. The property itself, the lease agreements, and maintenance are only part of the bigger picture.


But what if a reliable tenant stops paying rent? Or leaves behind a trail of unpaid bills? Frustration grows with each unanswered call and each ignored email. If you are not proactive, it enables your previous tenant to do the same with future housing providers. This leaves you in a difficult situation where your options can be limited.


Depending on the circumstance, you may attempt to collect debt on your own or hire a professional debt collection agency. But is it wise to take these conventional routes?

The Reality of Collection Agencies


Collection agencies specialize in recovering funds that are past due, and landlords often resort to their services after numerous unsuccessful attempts to collect unpaid rent. These agencies employ various strategies, some of which can be quite aggressive. These agencies may engage in unending telephone and email contact, and they may even appear at your previous renters’ doorstep.


These processes can be lengthy, expensive, and with no guarantee of rent collection success. Recent statistics reveal that debt collection agencies typically have a success rate of approximately 20-30%.1 Meaning, for every $100 in delinquent debt, the agency is likely to recover a sum of $20-30 only. Not only that, collection agencies often take a commission ranging from 25-50% of the total amount collected.2 Given these challenges, there is a need for an alternative solution.

Rent Payment Reporting, A Smarter Alternative


Reporting rent payments to the credit bureaus is that alternative — a more successful approach to responsible payment habits. Tying rent payments to credit scores makes residents more mindful of the impact of missing or skipping payments. Missing a payment could reduce their score significantly. 


What can you do with Rent Payment Reporting?


  • Report Unpaid Rent After a Tenant Moves Out

The Fair Credit Reporting Act (FCRA) allows you to report your previous tenant’s unpaid balances for up to 6 years and 9 months from the original delinquency date. Without seeing a tangible impact to their lives, these previous residents will just continuously ignore their debt. With rent reporting, they can now see and feel the impact of their negative payment habits to their credit scores. Your previous residents are now likely to settle the debt than to let outstanding balances stay on their credit reports.  With this leverage, we’ve seen residents communicating with their previous landlords or property managers again without consistently chasing after them.

“Our team appreciates the credit reporting solution that Sperlonga provides. Through their credit reporting, our residents are rewarded for on-time payments while late payers experience the consequences. We had a resident who moved out with a large balance and was not communicating with our team; we ended up having to submit the account to collections. After a few months, the resident reached out to our team to submit payment in full around the same time they disputed the account on their credit report. We are certain that the resident would not have paid us had it not been for Sperlonga reporting the account."

Amber Duke
Trio Residential
  • Reduce Delinquencies by up to 50%

Adopting this more proactive approach, when current residents know you are reporting, they will be discouraged to skip or miss payments, reducing the likelihood of eviction from non-payments. This not only safeguards your revenue but helps in creating a more responsible rental community.


  • Reward your On-time Renters

Report your residents’ on-time payments even 24 months back for those who have rented from you over the past 24 months. This allows them to build their credit report and scores without incurring debt and acts as a positive reinforcement for continued responsible behavior.


  • Earn Additional Revenue

You can offer this credit-building amenity to your renters at a margin that would give you additional cash flow. This value-added service not only benefits the renters but also contributes to your bottom line

  • Early Warning For Other Landlords and Property Managers

Putting rent payments on record serves as a warning system, helping other landlords and property managers avoid being in a similar situation in the future. It’s a win-win for the entire property management industry.


Unpaid rent can be a significant burden — even more so when the renter already moved out. While turning to collection agencies may seem like the conventional solution, reporting rent payments to the credit bureaus presents a more effective, and mutually beneficial alternative.


Implementing rent payment reporting might be the strategy you need to turn those recurring problems into opportunities for mutual growth. If you want to learn more, reach out to [email protected] or visit this link https://sperlongadata.com/sperlonga-free-consultation/ to schedule a free consultation.

1 Debt Collection Success Rate. Fair Capital LLC. June 30, 2023.


2 What Is a Debt Collection Agency and How Do They Get Paid? U.S. Chamber of Commerce.