Report From Protect Borrowers and Towards Justice Pulls Curtain Back on Predatory Short-Term, High-Cost Loans Marketed to Americans Struggling to Pay High Rents

February 4, 2026 | WASHINGTON, D.C. — Millions of Americans struggle to make rent every month, and the median household puts an average of 31 percent of its income towards rent payments. This economic reality has firms from Wall Street to Silicon Valley scrambling to take advantage of a new opportunity for easy profit, a new joint investigation from Protect Borrowers and Towards Justice reveals. The investigation charts the rise of “Rent Now, Pay Later” loans—short-term, high-cost loans that are little more than repackaged payday loans—and shines a light on predatory creditors capitalizing on sky-high rents by driving families into debt. With help from banks, including ones backed by venture capital funds like Andreessen Horowitz, these Rent Now, Pay Later companies can add thousands of dollars every year to rent bills that are already unaffordable. 

“Big banks and Big Tech are cashing in on the affordability crisis by hawking exploitative loans to Americans who are just trying to keep a roof over their heads,” said Ben Kaufman, Protect Borrowers senior fellow and coauthor of the report. “With political leadership at the federal level sabotaging consumer protection, it’s critical that state and local lawmakers, policymakers, and law enforcement take action to safeguard Americans from being pushed deeper into debt just from paying their rent.”

The new report by Protect Borrowers and Towards Justice, Rent Now, Pain Later: How “Rent Now, Pay Later” Loans Put Working People at Risk, is available here: https://protectborrowers.org/resource/rent-now-pain-later-report/ 

“These shady financial products—designed to take advantage of desperate renters—appear to involve all kinds of potential lawlessness. Any true affordability agenda must involve taking on the predatory cottage industry sprouting up around our rental market,” said David Seligman, coauthor of the report and executive director of Towards Justice.

The joint investigation focuses on firms across this emerging market, including Livble, a “Rent Now, Pay Later” company owned by the rental platform RealPage. RealPage has been accused by the U.S. Department of Justice and state law enforcers of executing a far-reaching scheme to raise the cost of rental housing in communities across the country. Last week, Buy Now Pay Later market leader Affirm announced that it intended to offer some customers a Rent Now Pay Later option—new evidence that lenders and landlords view rental debt as a key lever to prop up high housing costs and paper over families’ struggles to make rent.

The report reveals disturbing trends about Rent Now, Pay Later companies, and should serve as an alarm bell for federal, state, and local regulators and law enforcers. Among Protect Borrowers’ and Towards Justice’s findings:

  • Rent Now, Pay Later companies deploy a wide range of tactics—but they all push risky loans, some of which carry huge interest rates. The Rent Now, Pay Later lenders may have different structures—and some are already in the existing Buy Now, Pay Later market—but they all push products that involve sky-high costs and attempt to hide these fees by mislabeling charges and misleading consumers. In some cases, that obfuscation appears to attempt to exploit loopholes in the Truth in Lending Act. In others, it relies on companies framing loans so that consumers are unlikely to realize how payments might ultimately “stack” on top of each other, causing costs to snowball. The investigation reveals that in certain cases, the interest rates on these loans can exceed 180 percent—making them several times more costly than possible alternatives. 
  • Rent Now, Pay Later loans involve massive consumer risks, including possible eviction—and lenders are using tactics that have been cited by regulators as violating federal law. Complaints submitted to regulators like the Consumer Financial Protection Bureau (CFPB) and posts on social media platforms like Reddit reveal that Rent Now, Pay Later lenders appear to be unable to consistently deliver their advertised services, and to lack the basic customer support functions necessary to fix their mistakes. As a result, these companies have left consumers at risk of eviction through no fault of their own. In addition, these companies have deployed onerous repeat debit strategies that are already illegal under federal consumer protection statutes, demanded direct and risky access to people’s bank accounts, exposed working people to potential risks from dubious credit reporting that the companies spin as a helpful benefit, and more. All of these risks sit on top of a mountain of additional and dangerous fine print that holds up Rent Now, Pay Later products’ contracts.
  • Shady “rent-a-banks”—and in particular the venture capital-backed, Trump-connected Lead Bank—are cashing in on “Rent Now, Pay Later.” Rent Now, Pay Later companies have generally chosen to base their lending on deals with banks willing to lend out their charters to the highest bidder. These so-called “rent-a-bank” agreements have historically proven to be a vital method for fintechs to skirt certain state consumer protections and push loans with APRs into the hundreds. One particular bank, Lead Bank of Missouri, appears to be particularly active in the Rent Now, Pay Later market. That bank has seen its profits increase by a factor of five over the past five years as it has leaned into supporting fintech lending, and it recently reached its own multi-billion dollar valuation through fundraising backed by venture capital fund Andreessen Horowitz.

To protect the more than 109 million renting households in the U.S., Protect Borrowers and Towards Justice call on policymakers and law enforcement officials at every level of government to take immediate action to prevent corporate landlords, predatory lenders, and shady fintech companies from exploiting renters’ financial instability by driving them into rental debt, including by investigating and prosecuting Rent Now, Pay Later firms for violating federal and state consumer protections. 

The organizations also recommend that prudential regulators should supervise and enforce federal banking laws against banks engaged in Rent Now, Pay Later lending, and urge states to exercise their power under federal law to protect consumers from predatory, out-of-state rent-a-banks. Finally, the organizations call on federal and state lawmakers to ban corporate landlords from owning, operating, marketing, and embedding Rent Now, Pay Later products on rent payment platforms.

Further Reading

AP News story about renters using ‘Rent Now, Pay Later’: Renters use ‘rent now, pay later’ services to manage monthly payments, but fees raise concerns

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About Protect Borrowers

Protect Borrowers (formerly Student Borrower Protection Center) is a nonprofit organization led by a team of experts, lawyers, and advocates fighting to build an economy where debt doesn’t limit opportunity. We investigate financial abuses, take predatory companies to court, and push for policies to protect working people from debt traps. We aim to deliver immediate relief to families while building power, driving systemic change, and fighting for racial and economic justice.

Learn more at protectborrowers.org or follow us on social @BorrowerJustice.

About Towards Justice

Towards Justice is a nonprofit legal organization that uses impact litigation, policy advocacy, and collaboration with workers and worker organizations to build worker power and advance economic justice.

Learn more at towardsjustice.org or follow Towards Justice on Twitter @TowardsJustice.