California's Rent Reporting Law – AB 2747

What is AB 2747?

Assembly Bill 2747 is a California law designed to give renters the opportunity to build their credit by reporting rent payments to credit bureaus—while also creating clear responsibilities for landlords. Although rent is often a renter’s largest monthly expense, it historically hasn’t contributed to their credit score. AB 2747 aims to change that.For tenants, this is a chance to improve credit without taking on new debt. For landlords, it’s an opportunity to encourage on-time rent payments and stand out to responsible renters.AB 2747 paves the way for financial empowerment while giving landlords a way to support tenants and foster accountability.

Key Requirements for Landlords

To comply with AB 2747, landlords must:

1. Provide written details about rent reporting at the time of lease signing and once every year after.
   
2. Share the following information with tenants:
   
3. Any costs associated with rent reporting (capped at $10/month).
   
4. Clarify that rent reporting is optional.
   
5. State how rent payments will be reported.
   
6. Specify which credit bureaus will receive the data.
   

Inform tenants they may opt out at any time but cannot re-enroll for at least six months after opting out.

AB 2747 Compliance Checklist for Landlords

Charge no more than $10/month for rent reporting services.

Report on-time rent payments monthly to at least one major credit bureau.

Provide full disclosure to tenants about rent reporting and participation options.

Offer a clear opt-in and opt-out process.

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Rentaba Makes It Easy.

With Rentaba, landlords can:

- Report both on-time and overdue rent payments.

- Automate monthly reporting to major credit bureaus.

- Invite tenants and track their participation easily.

- Send built-in reminders and notifications.

- Ensure compliance with opt-in/opt-out protocols—no guesswork.

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Step-by-Step: How to Stay Compliant

1. Establish a Rent Reporting Policy:Define how you’ll offer the service, manage opt-ins/opt-outs, and structure any fees.
   
2. Update Lease Agreements:Include legally required language and disclosures to meet compliance standards.
   
3. Partner with a Rent Reporting Provider:Use a trusted platform like Rentaba to ensure accurate, timely submissions to the bureaus.
   
4. Maintain Transparent Records:Keep a clear paper trail of tenant elections, rent payment history, and communication.
   

Required Lease Language – Sample Clause

"In compliance with California AB 2747, you may choose to have your on-time rent payments reported to the credit bureaus to help build your credit history. Reporting will be made to Equifax, Experian, TransUnion, and other major bureaus through Rentaba. You may opt in or out at any time by notifying management in writing or responding to the invitation sent via Rentaba. If you choose to opt out, re-enrollment is allowed only after six months."

‍This clause ensures:

1. Rent reporting is presented as optional.
   
2. Tenants are informed of benefits.
   
3. There is a simple way to opt in or out.
   

Opt-In / Opt-Out Process

‍AB 2747 requires that tenants have full control over their participation. Landlords must provide a clear process. Reporting rent debts does not require consent and is not affected by a tenant’s opt-out choice.

‍Sample Clause:

‍“To enroll in rent reporting, complete the digital invitation from Rentaba or request enrollment in writing. Opt out anytime using the same methods. Opting out will stop future reporting but won’t remove previously reported payments. A six-month waiting period applies before rejoining.”

‍Required Notification:

Annual Reminder

Landlords must notify tenants of their rent reporting option annually.

‍Sample Notification Clause:

‍“Every year, you’ll receive written notification about your option to participate in Rent Reporting via Rentaba or directly from your property management team.”This helps avoid misunderstandings and maintains compliance with AB 2747.

Inform Your Current Tenants

For tenants already under lease, landlords should send a tenant notice outlining:

• The benefits of rent reporting.
  
• How to opt in or out.
  
• Which credit bureaus will receive the data.
  

This ensures all renters—new and existing—understand their rights and can participate in building their credit if they choose.

Credit Building for Tenants

Rent reporting is a low-risk way for renters—especially those with limited credit history—to build a positive credit profile. Unlike credit cards or loans, rent doesn’t come with interest or debt.

‍Benefits include:

• Easier approval for loans and apartments.
  
• Potentially lower interest rates.
  
• Reduced security deposits.
  

Studies show around 80% of participants saw their scores improve—with an average increase of 22 points.

Get Started with Rentaba Today

Offering rent reporting through Rentaba is fast and simple:

• Create a Rentaba landlord account.
  
• Add your property details and invite tenants.
  
• Tenants opt in with one click.
  
• Rentaba handles reporting to all four major bureaus.
  

You stay compliant—and your tenants build credit.

Disclaimer:

This page is for informational purposes only and does not constitute legal advice. Please consult a licensed attorney or legal expert for guidance specific to your situation.

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