How to Rent an Apartment With Bad Credit
For many people with bad or no credit, finding an apartment or other place for rent can become difficult. Even if a potential tenant shows up with cash, the property owner will still most likely run a credit check.
That credit check can ruin what was otherwise a good proposition. But there's hope for those with bad credit. It's still possible to rent a nice apartment; it just may require a little extra effort.
1. Check the Credit Report
Before doing anything else, it is important that people know what their credit report looks like. In some cases, having a copy of the credit report can even save potential renters some time and money. Providing the property owner a copy of a credit report can keep them from running them and charging for the service.
If finding an apartment isn't an immediate concern, potential renters can take some time out to try to repair their credit somewhat before they start searching for apartments. Otherwise, it helps for them to know what's listed on the credit report in general. A potential landlord may ask about some of those items.
2. Shop Around
A mistake that many people make is to narrow their choices down to just one apartment. In reality, it's usually better to narrow choices down to several picks. It's impossible to know how any one situation will play out. Placing hope on a single place can turn into disappointment.
Having multiple choices also allows people looking to deal with multiple personalities. Bad credit can cause a property owner to turn someone away, but there are other property owners that won't mind at all. Shopping around can give a nice mix of personalities to try to work with.
Independent vs managed
A good example of this idea comes with the type of location someone wants to rent. An independent landlord is more willing to work with someone. He or she is more amendable to working out deals or setting up unique payment plans.
By contrast, a property manager may have set guidelines that he or she cannot veer from in any way. So sometimes it's a good idea for renters to look beyond one type of dwelling. When the apartment complex won't deal, maybe the owner of a townhouse will.
3. Use a Cosigner
Using a cosigner is a tricky proposition.
- The property owner has to allow for someone to cosign.
- The cosigner has to have okay credit.
- The cosigner has to understand the responsibility involved.
However, a cosigner offers property managers a guarantee that they will receive their payments no matter what is going on.
4. Offer a Larger Deposit
As people say, money talks. Many property owners can look past bad credit if someone offers a larger initial deposit. Alternatively, offering to pay several months of the rent at one time can also sway a property owner that's indecisive. Not all property owners will accept such offers, but some will.
In some cases, the property owner may ask for more upfront to offset someone's bad credit. It's a proposition worth considering for those that have the means to pay that extra security deposit or fee.
5. Ask Past Landlords for Help
Letters of reference aren't always helpful, but sometimes they can come in handy. They do help to prove that despite bad credit, a person has still come up with their monthly payments and remained in good standing with the property owner.
This can also work with a letter of reference from some other professional. An employer or past employer can also write up such letters.
6. Check for Places that Don't Check Credit
Some property owners do not check credit. When searching for a place, apartment hunters may come across many listings that explicitly say they don't check credit.
Even for those that don't say anything about credit checks, potential renters can save a lot of time by simply contacting any that sound interesting, and blatantly asking if they run credit checks or not.
7. Stay Within Affordability
One mistake that many apartment hunters make is to look for apartments that are obviously outside of their means. It's understandable that someone would want a nice apartment in a nice area. They may even think that if push comes to shove, they can make up that monthly payment.
However, there is a better chance of getting the keys to an apartment for those that look at places they can easily afford. A good rent-to-income ratio will give a potential landlord a better look at what someone can and cannot afford.
Show and prove
Having a solid history of paychecks and rent payments proves that someone can handle future rent payments. Having a strong income shows that someone does have the means to make the payments. Those seeking a new apartment would do well to keep a full year of this kind of proof on hand.
Bad credit does not mean an apartment hunter cannot negotiate. This is especially true when dealing with independent landlords. People forget that a lease is a contract, and a contract isn't set in stone until it is signed.
There are several things someone could negotiate with a property owner that can improve their chances of moving in to the apartment they want, bad credit or not.
Move in date – For those willing to move in immediately, a property owner may not give as much thought to the credit check.
Trial or short lease – It is possible to suggest a month-to-month or short-term lease. The property owner may allow someone to stay in the apartment if they can pay for several months at one time. Landlords often want longer-term tenants, but they also want to keep their monthly payments coming in, so they may make an exception.
There are several points anybody can negotiate. If there isn't anything, it costs nothing to simply ask the property owner what's required to move in. The property owner may make some suggestions the renter can live with.
9. Be Honest
The most important tip for any apartment hunter is that they should always practice honesty. Signing on with a property owner represents a new relationship. A relationship that starts with falsehoods will end badly.
Bad credit can make finding a suitable apartment harder, but it doesn't make the process impossible. Start with credit, figure out budget, then start looking.