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Americans pay trillions in rent, but few get credit score boost for it
Americans pay trillions in rent, but few get credit score boost for it

CNBC

time11-06-2025

  • Business
  • CNBC

Americans pay trillions in rent, but few get credit score boost for it

An estimated $1.4 trillion is paid to landlords of residential properties every year in America, but only 20% of those landlords choose to report the rent paid. That has big implications for the credit scores and credit histories of millions of Americans. Reporting rent paid on time to credit bureaus can significantly boost credit scores, but since it has not traditionally been a common practice, some renters end up having no credit history at all, making them "credit invisible," limiting their ability to get a loan, a car, a house and a lot more. Over 50 million Americans lack a credit history with the three major credit bureaus: Experian, Equifax and TransUnion. "We're leaving over $5.3 trillion on the table, we've got to do better," said Wemimo Abbey, the CEO and co-founder of Esusu, which was named to the 2025 CNBC Disruptor 50 list, in an interview on CNBC's "Worldwide Exchange" on Wednesday. Esusu is a credit score reporting service which has partnered with 75% of the largest rental companies and more recently created a direct line for renters to report their rent payments. "We have democratized access because you have a long tail of people who don't live in commercially managed housing," Abbey said. Esusu has deals with Goldman Sachs, Mercy Housing, and Cushman & Wakefield, and partnerships with Fannie Mae and Freddie Mac, to increase the number of units nationally that report rent as part of credit. Credit scores, which range on a scale of 300-850, indicate the ability to pay back bills such as credit cards, and manage and limit debt owed. The lower a score, or the lack of any credit score at all, makes lenders hesitant to extend money, or they might charge extreme interest rates on a loan. Some landlords require a credit score on file to determine eligibility for a rental application, and while it's not the only considered data point, it may influence the landlord to not approve an application. This financial inequity significantly impacts minorities, with approximately 26% of Hispanic consumers and 27% of Black consumers being credit invisible or unscorable, compared to 16% of White and Asian consumers, according to data from Oliver Wyman. Immigrants are also more susceptible to invisibility as their credit file in the U.S. does not take into account their credit history in their origin country. Esusu founders Abbey and Samir Goel grew up watching their families struggle financially as immigrants from Lagos, Nigeria, and New Delhi, India, respectively, which was a founding motivation for Esusu. "When we came here, we didn't have a credit score. We went to one of the biggest financial institutions to borrow money; we were turned away and had to go borrow from a predatory lender who wanted to lend at over 400% interest rate," Abbey said. "My mother sold my dad's wedding ring. We borrowed money from church members and that's how we got started." Abbey said when Esusu started, only 10% of rent payments were reported to credit bureaus. Esusu has established credit scores for 250,000 Americans leading to $50 billion in credit activity, Abbey said. The startup's valuation has now reached $1 billion based on demand for the services. Rent is one of the largest expenditures for most Americans who do not own a home. More than 90% of renters pay rent on time, but since it's not reported, there's no record of it. Reports can be initiated either by the landlord or by the tenant. Commercially managed housing services may already have connections with one or all three credit report services, but may charge a fee to report it. Renters also have the option to directly connect with rent reporting services like Esusu, which charges a monthly fee of $2.50 to report timely payment on the renter's behalf. The record of the amount paid is expected to show up roughly 30 days after it's been paid. But paying rent is not enough; it needs to be paid on time. While some agencies may give 30 days to make up for the missed payment, others may not, and that can negatively impact a credit score. There are some other ways to build credit in addition to the rent reporting for those who lack credit histories or are looking to increase their credit scores. Becoming an authorized user on a family member or friend's credit card is one way. Getting a secured credit card, that has no annual fee, is another option. Using a credit-builder loan, in which banks provide the total loan amount after you've made a certain number of payments, and report your payment activity to the credit bureaus, is also an option for those with limited credit history and those who are credit invisible.

49. Esusu
49. Esusu

CNBC

time10-06-2025

  • Business
  • CNBC

49. Esusu

Founders: Wemimo Abbey (CEO), Samir GoelLaunched: 2016Headquarters: New York CityFunding: $145 millionValuation: $1 billionKey Technologies: N/AIndustry: FintechPrevious appearances on Disruptor 50 list: 0 Nearly 50 million people in the U.S. are considered to be "credit invisible," a number that disproportionately includes low-income and minority Americans, according to research from the Office of the Comptroller of the Currency. When a consumer is credit invisible, it means that they don't have a credit history with any of the three major credit bureaus: Experian, Equifax and TransUnion. That is an institutional hurdle which can hold many Americans back from ever reaching financial security. Fintech startup Esusu is looking to change the way credit is scored, with a focus on housing. On-time mortgage payments are known to increase one's credit score, while on-time rent payments have not typically been factored into credit reports. Many renters don't have any history of credit. Esusu records rental payment data and reports the information to credit bureaus. Since its launch, Esusu has helped renters by generating over 200,000 new credit scores and raising existing credit scores by an average of over 100 points. Property managers also benefit from the on-time rent payment system. Esusu founders Wemimo Abbey and Samir Goel grew up watching their families struggle financially as immigrants from Lagos, Nigeria, and New Delhi, India, and those financial obstacles were a founding motivation for Esusu and its goal of helping Americans build strong credit histories. "When my folks moved here, our journey to pursue the American Dream was just harder than it should have been," Goel told to CNBC in a 2021 interview. "I remember just watching my parents work miracles with no credit and limited financial resources. Abbey and I like to say we are inspired by our experiences." Esusu has paved a path for itself in the fintech industry by serving as a rent reporting provider for major names in finance and real estate including Goldman Sachs, Mercy Housing and Cushman & Wakefield. Last year, Esusu expanded its presence in the direct-to-consumer market. Previously, the company was only available for renters living in an Esusu-participating property. With the launch of myEsusu, all renters are now able to use the application and can choose between a free account or a membership that offers additional tools for $2.50 per month, or $29.99 per year. Application users are able to gain credit for paying their rent on time, learn about credit building products and services, view a credit score hub and access financial resources. Esusu also has partnerships with Fannie Mae and Freddie Mac to increase the number of units nationally that report rent as part of credit and improve the credit scores across more Americans. The company has received backing from tennis legend Serena Williams' venture capital firm Serena Ventures.

The 44 Percent: Black homeownership, Cam Ward, Sam Cooke and Ryan Coogler
The 44 Percent: Black homeownership, Cam Ward, Sam Cooke and Ryan Coogler

Miami Herald

time24-04-2025

  • Entertainment
  • Miami Herald

The 44 Percent: Black homeownership, Cam Ward, Sam Cooke and Ryan Coogler

In 2019, when it was reported that Quentin Tarantino structured a deal with Sony in which he would retain the rights of his film 'Once Upon A Time In Hollywood,' it was lauded as a rare deal only a few movers and shakers such as George Lucas ('Star Wars' franchise) and Mel Gibson ('The Passion of the Christ') secure for themselves. One article goes on to list a litany of white male directors who have made this deal. This is why the reported passive-aggressive responses to filmmaker Ryan Coogler inking a similar deal for his blockbuster film 'Sinners' are jarring by comparison. Instead of being welcomed into a rare club, Coogler has been met with the coded language of 'dangerous' and other bad faith framing that suggests because this particular person (read: Black) made these asks and they were met, it sets a bad precedent for other filmmakers and studios. Still, ownership for Black people means something. We know if we buy a home, it is not just a place of comfort it is a means of accumulating generational wealth. Similarly, some Black business owners know they have the independence of setting their own hours and not answering to a boss, board of directors or figurehead, and, again, is a means of accumulating generational wealth. So, the coded language used to criticize, question and undermine Coogler is intended to dissuade other Black filmmakers from pursuing the same deals that white counterparts have already been granted. It also seeks to simply put a 'Black boy' in his place. What Coogler showed through his deal is that ownership is necessary for our Black communities to thrive. And at a time when there are individuals seeking to stymie Black people's efforts to grow, it's important now more than ever to seek ownership as often as we can and in creative ways. INSIDE THE 305: Black South Floridians struggle to buy and keep homes in Miami's gentrifying communities Minority Business reporter Michael Butler and I worked on a story about the struggles of Black homeownership in South Florida. Whether it's buying a home or holding onto a legacy home, these Black families spoke to the challenges faced in a tense South Florida housing market. Partnership between Black-owned app and bank helps Miami renters build credit Low credit scores have traditionally been a barrier for Black families obtaining home loans. But Black-owned bank, OneUnited, and credit reporting app Esusu hope to change that. As Butler reported, the goal is to help renters build their credit score based on their positive rental histories. Esusu will report the monthly rental payments to the credit bureaus to help them build credit. 'Historically, it has not been included,'OneUnited Bank CEO Teri Williams told the Miami Herald. 'They ding you when you pay your credit card 30 days late, but you may still be paying your rent every month on time.' All Cam Ward needed 'was a chance.' Now, he will likely be the top pick in the NFL Draft Cam Ward consistently bet on himself. It has now led him to be the likely top pick in the NFL Draft, making him the third Miami Hurricanes player to be selected No. 1 overall, UM Hurricanes reporter Jordan McPherson writes. As McPherson reports: It will be Ward's latest ascent in a career full of ascension. But as the stage got bigger and the lights got brighter, Ward never let it faze him. 'It just goes back to me not forgetting where I came from,' Ward said. 'I carry myself in a certain type of way. All I want to do is play football and be with my teammates. So long as I be a good person, it'll work out the long run.' OUTSIDE THE 305: Tina Knowles Reveals Breast Cancer Diagnosis And Shares 1 Important Lesson In a vulnerable interview with CBS Morning News' Gayle King, Tina Knowles, mother to singers Beyonce and Solange, revealed she was diagnosed with breast cancer. 'It was stage 1, which I thought was the earliest stage, and when I told my sister she said, 'No, there's a zero,'' Knowles told King. Knowles said it might have been caught sooner had she not missed her mammogram due to the COVID-19 pandemic. The interview is part of Knowles' press run for new book 'Matriarch,' released on Tuesday. Knowles does not have a stop in Florida during her book tour, but those interested can find more about her book here. With heart and history, FSU Legend Charlie Ward steps into role at FAMU Heisman trophy winner and Florida State University dynamo Charlie Ward detailed his plans for FAMU's basketball program at a press conference formally introducing him as the Rattlers' head coach, FSU Seminoles on SI reported. 'Our goal as a program would be to focus on the whole athlete by providing them opportunities and professional development, community outreach, team bonding, and being leaders on campus. We will develop men of character and integrity so they can reach whatever goal they set,' Ward continued. 'I'm committed to building a team that competes hard, plays with discipline, and represents FAMU with pride.' HIGH CULTURE: Hampton Art Lovers Presents: Jazz Under a Simple Tree: Live @ Harlem Square (1963) Recorded in 1963 in Overtown, Sam Cooke's 'Live at the Harlem Square Club, 1963' is heralded as one of the best live albums. And Thursday, jazz lovers can hear the sounds of Cooke as Miami group Old Skool Gang performs the full live recording at the Historic Ward Rooming House Gallery at 249 NW 9th Street in Overtown. The event starts at 7 p.m.

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