It goes without saying that landlords prefer to rent to tenants who they know will pay on time each month. To do this, they check each tenant's credit score before approving a move-in. With this in mind, it's easy to see that having a poor credit score can damage your renting prospects—but what does it take to rent an apartment when your credit history has room for improvement?
Read on to see how your credit score can affect your rental options.
The Approval Process
When you apply for an apartment, the initial paperwork usually involves filling out a form authorizing the apartment complex to check your credit history. If you have a solid history of using and repaying credit, you will likely be approved without issue. However, people with poor credit scores may have their applications rejected by property managers. This is the first major obstacle to renting an apartment with poor credit. If this is your situation, talk to the landlord and explain your past mistakes while you work on rebuilding your credit history.
If you're an applicant who has a poor credit history, your rental options may be scarcer, so you may need to rely on other options while you improve your credit. For some, receiving a recommendation letter from someone with whom you have a financial history—such as a previous landlord, your bank or your employer—is enough to convince a landlord to rent to you. Others may need to convince friends or family members to cosign on their leases in order to get the green light.
Paying Up Front
For landlords, rental properties are a source of income, so they will be wary of a potential tenant who puts that income in jeopardy. One way that many landlords counteract the risks associated with poor credit is through increasing the amount of money high-risk tenants pay up front. This may mean that these tenants have to pay a higher security deposit or several months of rent up front in order to mitigate the landlord's risk in approving their applications. For help on finding the right apartment for you, despite budget constraints, check out our blog: The Guide to Securing a Safe Comfortable Apartment on a Budget.