Rent payments often represent a household’s largest monthly expense. Yet for many renters, years of consistent payments do little to strengthen a credit profile. Minnesota lawmakers are working to change that pattern.

A proposed housing bill would allow tenants to turn their on-time rent payments into credit-building records—potentially opening the door to homeownership for thousands of residents across the state.

The proposal focuses on a simple idea: if renters reliably pay their housing costs every month, that financial behavior should count toward their credit history. By connecting rent payments with credit reporting systems, the bill attempts to reduce one of the most common barriers renters face when applying for a mortgage.

Lawmakers Push for Rent Reporting

Minnesota legislators are reviewing a housing proposal designed to help renters strengthen their credit scores. The measure, HF2123, is sponsored by Democratic state Representative Samakab Hussein. Amendments introduced in March outline a new requirement for landlords with 10 or more rental units.

Under the proposal, these landlords must give tenants the option to report their on-time rent payments to major credit bureaus. The goal is to ensure that a tenant’s consistent payment history contributes to their credit profile, similar to credit card or loan payments.

house.mn.gov | Rep. Hussein’s new bill mandates that landlords with 10+ units report rental data for tenant credit boosts.

The measure focuses on accessibility. Tenants would not face extra charges simply for having their rent payments reported. Participation remains voluntary. A renter may choose to enroll in reporting and may also withdraw from the program at any time. Once a tenant opts out, the landlord must remove them from reporting systems within 30 days.

Why Credit Scores Matter for Homebuyers

Credit scores play a central role in the mortgage approval process. Lenders review a borrower’s credit history before deciding whether to issue a loan. A stronger credit score can lead to approval for a mortgage and may also secure lower interest rates, which significantly affect long-term housing costs.

The current credit system often leaves many renters at a disadvantage. Traditional credit histories typically grow through credit card payments, utility bills and loan repayments.

Rent payments rarely appear in credit reports unless landlords actively submit that information. As a result, renters who consistently meet their largest financial obligation may still appear “credit invisible” when lenders review their applications.

The Minnesota proposal attempts to close that gap by allowing rent payment history to contribute directly to a borrower’s credit record.

Rent Payment Reporting Is Gaining Attention

Using rent payments to strengthen credit scores is not a new concept. Financial institutions have recently expanded the ways they evaluate borrowers.

Last year, Fannie Mae and Freddie Mac revised their policies to allow lenders to consider VantageScore credit ratings in addition to traditional FICO scores when assessing mortgage applicants. VantageScore calculations can include rent payment history—provided that landlords report those payments to one of the three major credit bureaus: Equifax, Experian and TransUnion.

When rent data is reported consistently, the payment history becomes part of a consumer’s credit profile.

Bill Pulte, Director of the Federal Housing Finance Agency and chairman of both Fannie Mae and Freddie Mac, addressed the change in a social media post in July.

He wrote, “We are expanding credit access to millions of forgotten Americans—people who live in rural areas, renters who pay their rent on time every month—and bringing down closing costs.”

Despite this policy shift, renters only benefit if landlords actually report payment records. The Minnesota bill directly addresses that issue by requiring large landlords to provide the reporting option.

Addressing Credit Gaps Among Renters

Supporters of the legislation point to longstanding financial disparities affecting certain communities. Many households, particularly those with lower incomes, struggle to build credit because they lack access to traditional financial tools.

The bill aims to assist groups often labeled as credit invisible, including renters who maintain stable housing payments but have limited access to credit products.

According to supporters, this policy may help narrow wealth gaps by allowing rent payments to count toward mortgage qualification. Without such reporting, renters often remain locked out of homeownership despite maintaining strong payment habits.

Housing and Lending Advocates Perspectives

Housing advocates argue that credit access influences far more than homeownership. It can affect employment opportunities, transportation access, and housing stability.

Kaelah Mundley, a community lending coordinator at Exodus Lending in St. Paul, Minnesota, addressed the broader impact of credit access in a public statement:

“Credit is not a luxury; it is a gateway to housing, transportation, and even employment.”

Organizations representing minority communities have also expressed support. The Council for Minnesotans of African Heritage submitted a letter to the Minnesota House Housing Finance and Policy Committee on March 17 explaining the economic context behind the proposal.

The letter stated:

“Inadequate access to finance capital plays a major role in income and wealth disparities and other structural economic disadvantages. Financial hardships impact African Heritage families at higher rates than other populations.”

The council highlighted several concerning trends. Black households are more likely to lack checking or savings accounts. Among renters with identical income levels, Black renters tend to have significantly lower credit scores than other groups.

The letter continued:

“HF2123/SF2807 provides one set of policy solutions for addressing these economic disadvantages.”

Similar Policies Exist in Other States

Instagram | crainsnewyork | Several states, including New York, Colorado, and California, have already pioneered rent reporting laws to boost credit building.

Minnesota is not the first state to explore rent reporting laws. Over the past five years, several states have adopted policies aimed at recognizing rent payments within credit systems.

States that have passed similar legislation include New York, Colorado and California.

These laws generally focus on encouraging or requiring landlords to provide renters with access to rent reporting programs. Supporters say these policies help renters build a stronger financial profile without taking on additional debt.

Funding Support for Landlords

The proposed Minnesota bill also addresses the administrative costs landlords may face when reporting rent payments.

If approved, the legislation would allocate $500,000 from the state’s general fund for each fiscal year 2026 and 2027. These funds would provide grants to assist landlords with credit reporting expenses.

Priority for these grants would go to property owners whose tenants earn 50 percent or less of the area median income. Lawmakers included this provision to ensure that the program primarily benefits households facing the greatest financial barriers.

Minnesota’s housing proposal reflects a growing national effort to recognize rent payments as meaningful financial behavior. By allowing renters to convert consistent housing payments into credit-building activity, lawmakers aim to remove a barrier that often blocks the path to homeownership.

The legislation has not yet received final approval. If it moves forward, tenants across Minnesota could gain a new opportunity to strengthen their credit scores simply by continuing to pay rent on time—something millions already do every month.