Money Tips & Tricks for Renters

Bad Credit Apartments: How to Get a Lease When You Have a Low Credit Score

Having a credit card can be beneficial, but it also comes with great responsibility. Late payments and overused credit are just two of the behaviors that can lower your credit score. Any defaulting debt or loan can also lower your credit score significantly.

Bad credit means having a score between 300 and 629. When you have bad credit, getting an apartment lease becomes difficult because landlords may be hesitant to lend you their property if they are concerned that you may not make your payments. But it also depends on how low on the scale your credit score is, as some landlords consider scores between 580-630 acceptable.

Fortunately, even if you have damaged credit, getting an apartment lease is still possible:

How to Rent an Apartment with Bad Credit

1. Know Your Credit Score
The best way to fix something is to acknowledge that it needs fixing in the first place. Whether you need to work on your credit depends on what your credit history is. You can check your credit report at any credit-reporting agencies for free and decide what to do to improve it.

2. Own Up to Your Bad Credit
Most property managers will check your credit as part of the application process. Even when they don’t, it’s best to be honest about your credit score when talking to your landlord. This not only allows you to explain yourself, but it can make you seem more responsible by owning up to your mistakes. Also, make sure to indicate how you plan to show the landlord that you won’t make those same mistakes again.

3. Get a Recommendation
There are many reasons for which your credit could have dropped, whether it’s due to an unfavorable situation, such as a divorce, job loss, or medical bills, or just financial irresponsibility at some point in your life. Asking for a recommendation from either a previous landlord, bank or employers can greatly help your case as far as getting a rental.

4. Have a Co-Signer or Roommate
Getting a co-signer or roommate with good credit is the most likely to get you an apartment when your credit is bad. If they have a good credit record, the landlord will likely base his or her decision on their credit score. However, you’re still responsible for your portion of the rent, regardless of whether someone else signs on to be responsible for your rent or you have another person living with you and paying rent. Make sure to always make your payments on time and build up your financial credibility.

5. Demonstrate Steady and Provable Income
Although your past financial situation may have led to your bad credit score, a stable income now can help you fix your credit record and land that lease. Having a monthly income of at least three times the monthly rent and a stable income can be a great indicator to your landlord that you can keep up with your payments. Use a rent calculator to figure out how much rent you can afford on your income. Furthermore, set up automatic payments to allow your landlord to withdraw rent from your bank account each month.

6. Pay More Upfront
Renting with bad credit can also involve a higher upfront cost, typically a higher security deposit, covering 2 to 3 months’ worth of rent. This will offer your landlord some security in case of late payments.

Having bad credit can certainly cause some challenges when you’re looking to rent an apartment, or take out a student loan, or do anything that involves someone relying on your financial responsibility. However, there are ways to make up for your past mistakes and improve your credit score.

How to Remedy Your Bad Credit

While having no credit is better than having bad credit, it is possible to improve your credit score, but it takes time. In fact, missteps in your credit history stay on your credit report for 7 years.

The first step to improve your credit score is to catch up on all of your late payments. It’s also extremely important to make sure you pay them in full to avoid accumulating additional interest fees, which will further affect your credit score.

Also, if you have loans in collections, whether they are student, personal, or auto, you need to work on reducing the amount you owe, so that your debt-to-credit ratio is lower. Eventually, you can start paying off the entire debt that you have in collection.

Credits and loans are meant to help us in our daily lives, especially when it comes to the larger and more costly decisions. However, being responsible in repaying them is important to ensure that we can continue to benefit from this financial help in the future, whether to get an apartment lease, a car or even buy a house.

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About the author

Sanziana Bona

Sanziana Bona is a creative writer and researcher for RENTCafé, with a strong passion for the dynamic real estate market, covering topics from lifestyle to market trends. She has a B.A. in International Relations and Spanish from Michigan State University, a LL.M. in International Business Law, Contracting and International Relations from Instituto Superior de Derecho y Economía. You can connect with Sanziana via email.

Sanziana’s work has been featured in CNBC, CBS News, NBC New York, The Press Democrat, Wolf Street and The Registry San Francisco, among others. Prior to joining the RENTCafé team, she wrote extensive analysis papers on world topics such as human rights violations, international laws, and world conflicts, as well as arts literature, in both English and Spanish.

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