The end of the federal student loan forgiveness program has left millions of borrowers facing monthly payments for the first time in years. This financial strain is reshaping the rental market and creating new challenges for property managers who rely on credit-based scoring to assess
According to a recent analysis from TransUnion (NYSE: TRU), it has caused a financial strain that is reshaping the nation’s rental market and creating new challenges for property managers who depend on credit-based scoring to assess risk.
TransUnion said the analysis shows that the number of rental applicants 90+ days delinquent on student loans more than doubled in the first half of 2025, up from 15% in January to 32% in May.
Some Renters Experience Falling Credit Scores
“The influx of applicants struggling with student loan payments could significantly impact property managers,” said Maitri Johnson, EVP of TransUnion’s tenant and employment screening business. “Applicants who once met screening thresholds are now falling short.”
TransUnion said its report shows that renters with Prime credit scores (661-720) – previously considered low risk – are falling into riskier categories. Consumers across all tiers experienced notable score declines, TransUnion said.
The company said, however, that traditional credit scores predict loan repayment, not rental performance.
They overlook critical indicators such as eviction history and rental payment behavior, TransUnion said. Property managers using purpose-built rental risk models can reduce exposure without shrinking applicant pools, enabling faster, more confident leasing decisions, the report said.
TransUnion’s report also warns that financial stress can drive fraud.
It said that renters under financial pressure may falsify documents or misrepresent income. Multifamily-specific fraud detection tools can help verify identities, flag suspicious applications, and prevent costly evictions, TransUnion said.
“Student loan stress is reshaping the rental landscape, and traditional screening methods simply can’t keep up,” Johnson said. “With delinquencies doubling and credit tiers slipping, property managers must evolve their strategies.”
A global information and insists company, TransUnion has more 13,000 associates in more than 30 countries.
