State Lawmakers Must Protect Tenants from Rent-Splitting Loans

October 20, 2026 — Press Release

“Rent Now, Pay Later” Loans Can Carry High Fees and Trap Renters in Cycles of Debt

WASHINGTON – As renters across the country face increasing housing insecurity, new rent-splitting products are adding expense and risk. Companies selling rent-splitting loans, also known as “rent now, pay later,” claim to solve tenants’ “cash flow problem” by allowing tenants to break rent into multiple payments. Instead, these loans risk increasing financial pressure on families struggling to keep a roof over their heads. 

A new National Consumer Law Center (NCLC) issue brief, What States Can Do to Protect Tenants from Rent-Splitting Loans, identifies measures states should take to address housing unaffordability and strengthen tenant protections to ensure tenants do not have to resort to high-cost credit products. They must also strengthen existing laws governing these rent-splitting loans.

“The bottom line is that rent-splitting loans come at a cost—people who turn to these products  pay a premium to get all of their rent paid at one time,” said Ariel Nelson, senior attorney at the National Consumer Law Center. “Many rent-splitting companies charge steep fees.” 

Rent-splitting companies include Flex, Esusu, Split Pay, Qira, and Livble; the fees they charge can include membership or subscription fees, late fees, processing fees, “split” fees,  and origination fees. And when tenants provide direct bank account access, the loan products could result in bank overdraft and insufficient funds fees. Some companies lure tenants by burying cost information or structuring their products so they appear inexpensive. Others claim 0% interest but charge high fees.

“Like payday loans and other short-term loans, rent-splitting loans can lead to cycles of debt, reborrowing, and multiplying fees that are hard to escape,” said Lauren Saunders, senior attorney at the National Consumer Law Center. 

Tenants turning to rent-splitting loans also risk technical and customer service failures, such as a company failing to pay rent and subjecting the tenant to threats of eviction. They may also come with subscriptions bundled with other products that can drive up costs. Contractual traps, such as arbitration clauses and class action waivers, that limit customers’ ability to hold companies accountable and obtain relief are also common. 

To address housing unaffordability and strengthen tenant protections to ensure tenants do not have to resort to high-cost credit products to pay rent on time, states must cap and regulate landlord-imposed late fees and other rental housing junk fees. States should also take additional action, including requiring landlords to:

• Accept rent in two installments without cost to the tenant;
• Change the rent due date for free upon request;
• Allow tenants to pay one month’s rent from multiple payment sources; 
• Offer at least one free and accessible payment method, and cap any “pay-to-pay” or convenience fees.

States should take steps to strengthen existing laws governing rent-splitting loans and enforce those laws, including:

• Banning subscription fees for rent-splitting loans;
• Treating rent-splitting loans as closed-end credit and require inclusion of all fees (including subscription fees if not banned) in the interest rate/APR cap. This cap should be 36% or less, calculated based on each extension of credit;
• Bringing enforcement actions, issuing guidance, or closing loopholes to ensure that small-loan laws, including rate caps and license requirements, apply. 
• Limiting late fees to a total of $8 per month (as the Consumer Financial Protection Bureau attempted to do for credit cards).

Related Resources

• NCLC Issue Brief: States Can Protect Buy Now, Pay Later Borrowers, February 2026
• NCLC Issue Brief: Risks and Advice for Buy Now, Pay Later, May 2025
• Protect Borrowers and Towards Justice’s Report: Rent Now Pain Later, February 2026