Searching for an ideal apartment can be a complex process, and factors like finding a comfortable living space, affordable rent, and compatible roommates are just the tip of the iceberg. The real challenge comes with the landlord’s background check. And if you are looking to rent with bad credit — this step might seem extremely worrying. And while it is true that a low credit score can make it challenging to secure a lease, it is not impossible.
So, before you lose all hope about how you will ever rent an apartment with bad credit — remember that there is a lot more to getting a tenancy approval other than your credit score. Even if you are stuck with bad credit, there is plenty you can do to find no credit check apartments or apartments that accept bad credit.
In this article, we cover all there is to know about the ordeal of renting with bad credit and the steps you can take to endure it. Your dream apartment is getting approved in 3…2…1.
11 Tips for Renting With Bad Credit
Here’s the deal: landlords are always looking for reliable tenants they can trust to pay rent on time. If you don’t have a great credit score or a good rental history, they may see you as a risky candidate.
But hey, there’s always a way to beat the system and wiggle your way in! Here is everything you need to rent an apartment regardless of your bad credit.
1. Show Proof of Income and Employment
If you are looking to rent with bad credit but have a high income, you are already way ahead of the game. Landlords prefer your monthly income to be at least three times your monthly rent (In NYC it is usually your annual salary should exceed the monthly rent times 40). The numbers make it all more likely that you will be paying your rent and bills on time.
Additionally, you could provide documents to support your claim, such as,
- Recent pay cheques
- Job letter as proof of employment
- Proof of previous rental and utility payments
If a landlord sees that you have a stable income and a history of making regular payments, they may be more willing to overlook your bad credit history and consider you as a potential tenant.
2. Provide References
Have others vouch for your responsible attitude and good character. A character reference from a former landlord is sure to impress your new one. After all, landlords appreciate two types of tenants: those who keep things tidy and those who pay rent promptly.
But, if you are new to renting, references from anyone you have had a financial relationship with will do. Such as your bank, anyone you co-leased with, or even your boss. Avoid references from family or friends as it comes across as biased and doesn’t leave much impact on your application. It can also suggest that you don’t have many financial connections making you look unreliable and new to the game.
Character references especially come in handy when you are looking to rent as an ex-convict. They can help prove your credibility and trustworthiness to prospective landlords.
3. Pay a Higher Deposit
This tip just makes good sense. If you can’t back your application with a stellar credit score or a high income — you could easily become a liability to the landlord. Eliminate that risk by offering to pay more upfront. Usually, higher deposits mean paying 3 to 4 months of rent in advance.
Sure, it might put you in a bit of a financial crunch to come up with that extra cash upfront, but it could be worth it. And once you’re settled in and your next paycheck comes around, you’ll be able to breathe a bit easier.
However, in some highly competitive rental markets, landlords may receive multiple applications from qualified tenants, making it difficult to stand out even if you offer a higher deposit.
4. Offer to Move in Right Away
If you are lucky, you might come across a landlord looking to lease their place as soon as possible. Most landlords look for tenants who can move in right away to ensure they don’t lose out on a month’s rent.
If you can speed up your move-in date, they may forgo your credit check or even background checks to get a tenant in quickly and start collecting rent.
So if you’re on the hunt for an apartment and you’re able to move quickly, keep an eye out for landlords who are eager to fill their units as soon as possible.
5. Consider a Cosigner
A cosigner is someone willing to vouch for you financially. They will agree to take responsibility for your rental payments if you can’t make them yourself. It could be a parent, a sibling, a friend, or anyone else who’s willing to help you out. Keep in mind that your cosigner has to have a solid credit score and high income. In New York, a cosigner typically needs to demonstrate and annual income of 80 times the monthly rent or greater.
Before bringing a cosigner to the table, do your research and review the rental agreement carefully. Make sure the cosigner understands what they are agreeing to and the potential risks involved. You don’t want to put anyone in a precarious financial situation if things go awry.
Moreover, having a cosigner does not absolve you of your responsibility to pay rent on time. Always ensure that you have a plan in place to meet your financial obligations, regardless of whether or not you have a cosigner.
Overall, having a cosigner can be a great way to boost your chances of getting approved for a rental property, especially if you have bad credit or a low income. Just make sure you choose someone you trust and who has a good credit history.
6. Look for Month-to-Month Leases
Another good option to explore is a month-to-month lease. A month-to-month lease is one with no set end date. Both the landlord and the tenant can end the lease agreement at any given time with proper notice.
Since the lease agreement is relatively short-term and gives the landlord the security of being able to end the contract, they may be more willing to work with tenants who have less-than-stellar credit.
Just be aware that with a month-to-month lease, you may have less stability and security than you would with a longer-term lease agreement.
7. Find Roommates
You could increase your chances of getting approved by finding roommates to rent with. For example, if you and your roommates have similar income levels and credit scores, you can collectively present a stronger financial profile to the landlord. Moreover, if one of you has a weaker financial profile, the other roommates can serve as co-signers, improving your chances of getting approved.
Landlords also prefer renting to two or more roommates. Because if one roommate misses a payment, the other roommates can usually cover it, which makes non-payment less likely. And if you’re renting with two or three people, at least one of you would have a good credit score, right?
Another great thing about renting with roommates is that it can ease the financial burden on you, which makes it more likely that you’ll be able to pay on time.
8. Offer to Set Up Autopay
Here is a little trade secret for you; landlords love receiving payments on autopay. They are consistent, reliable, and timely.
If you’re looking to rent with bad credit, offering to use automated rent payments can be a way to reassure landlords that you are committed to paying rent on time, even if you have a less-than-perfect credit history. By automating payments, tenants can demonstrate that they are serious about being responsible renters and building a positive relationship with their landlord.
There are many options for setting up automated rent payments, including online payment systems, automatic clearinghouses, and direct deposit. Renters can work with their landlords to determine the best payment method for their situation and set up a payment schedule that works for both parties. Some landlords will also have the ability to direct debit your account (with your authorization of course), which can also assure them that they will be paid on-time, always.
By taking advantage of automated rent payments, renters can improve their chances of getting approved for a rental property and build a positive relationship with their landlord.
9. Explore Private Properties and No Credit Check Apartments
If you are having trouble renting with poor credit, explore apartments owned by private landlords. Most apartment complexes are managed by property management companies that have stricter rules and credit checks since they are managing multiple properties and need a standard to adhere to.
You can find no credit check apartments owned by individuals and private landlords. Many do not require a credit check, while others may be more lenient with credit history and income requirements. People with bad credit or a criminal record find it easier to rent privately owned buildings rather than publicly managed ones.
Private landlords may also be more willing to negotiate lease terms or make exceptions for specific tenant needs, such as pets, smoking, etc. And if you can provide them with supporting documents to ensure your ability to pay rent, you are more likely to be able to find apartments that accept bad credit.
10. Use Guarantors
When you are renting with bad credit and low income, a guarantor is just the knight you need to save the day (more like your lease agreement).
Guarantors and co-signers work similarly. Both individuals or entities agree to take financial responsibility for a tenant’s rent payments if the tenant is unable to do so. However, guarantors are companies that co-sign your lease in exchange for a monthly payment fee, while cosigners are usually immediate friends or family.
If you don’t have a family or friend willing to become a co-signer with you, that is when you should approach a guarantor. Guarantors like Leap and The Guarantors are fairly popular with customers.
It gives the landlord a little extra security cushion — someone to go to if you fail to pay your rent and avoid lengthy legal battles.
11. Be Honest About Your Credit History
When it comes to renting with bad credit, the best thing you could do is be open about it. If you’re starting out and your credit score is not so great, don’t sweat it too much — you should easily be able to explain your predicament to a landlord.
And don’t forget to let them know that you’re working on improving your score. They’ll appreciate your honesty and effort.
\\ Speaking of improving your score, did you know that you can now build your credit score simply by paying rent using a credit builder service like Boom. They’ll report your rent payments to the credit bureaus and help you build your credit score. You can even use Boom to report your past rent payments to help you build up credit score //
Finally, don’t be discouraged if you get turned down by some landlords. Not everyone is willing to take a chance on a tenant with bad credit. But with patience and resilience, you should be able to find a landlord who is willing to work with you.
What Landlords Look for When Renting
While you could get by for a few years following these tips and tricks to make your way into scoring a good property to rent, it is by no means a lasting method.
When it comes to renting a new place, it’s important to first understand what landlords and property management companies are looking for in your application. Essentially, they want to know two things: can you afford the place, and can they trust you to pay your rent on time? Your credit score is a crucial part of this equation, as it provides a snapshot of your financial situation.
When landlords review your credit score, they typically look at three key factors: payment history, credit utilization, and debt.
- Payment History: Your payment history includes things like credit card payments, loans, and other bills. If you have a history of making payments on time, it indicates to the landlord that you’re likely to pay your rent on time as well. On the other hand, missed payments or late payments can be a red flag.
- Credit utilization: Landlords may also consider your credit utilization, which is the amount of credit you are using compared to your available credit. High credit utilization could indicate that you are relying heavily on credit and may face difficulty paying bills on time.
- Debt: Finally, your debt load is also an important factor. Landlords want to make sure that you are not carrying too much debt, as it can impact your ability to pay your rent on time. For example, a high debt-to-income ratio could indicate that you may struggle to pay rent on time or in full.
A good credit score determines your access to wealth and more importantly, can provide better and easier rentals. Whether you are new to building credit or mistakes made in the past struck you with bad credit, there are several steps you can take to build a strong credit score.
So, although having bad credit might not be the end of the world, it’s obvious that having a solid credit score is well worth the effort. By taking the right steps and being patient, you can take charge of your credit history and make your rental situation a whole lot smoother. Trust us, ‘future you’ will thank you for putting in the work.
Bottom Line
Renting with bad credit is not the nightmare many make it out to be. Sure, it can be a challenge, but it’s not impossible. By following these tips, such as getting a co-signer or guarantor, paying more upfront, or finding apartments that accept bad credit, you can increase your chances of getting approved for a rental even with a less-than-stellar credit history.
However, it’s important to remember that these tips are only temporary solutions. In the long term, working on building and improving your credit history is crucial. This can involve things like making payments on time, paying down debt, and disputing any errors on your credit report.
So even if you’re able to secure a rental with bad credit using our tips, don’t stop there! Keep working on improving your credit so that you can enjoy better financial health and more options in the future.
Just remember, it’s not the end of the world if you get rejected a few times — it just means you’ll have to keep swiping left until you find the right match!
Frequently Asked Questions
Do you even need a credit score to rent an apartment?
Yes, most landlords assess your credit score to determine your ability to pay rent. But rental requirements can vary from property to property. If you don’t have a credit score or have a low credit score, landlords may require additional documentation or proof of income to assess your ability to pay rent.
What is the minimum credit score to rent an apartment?
There is no standard minimum credit score needed to rent an apartment. However, landlords typically look for a minimum credit score of 600 to 620. If your credit score is way below the landlord’s requirement, you may need to provide a guarantor, advance deposit, etc.
Can a prior eviction make it difficult for me to rent in the future?
Yes, almost certainly. Many landlords and property managers conduct background checks and may reject applicants with a history of evictions. However, a little extra effort from your end by offering higher deposits, guarantors, or proof of a steady income can help in getting an apartment with bad credit.
How can I raise my credit score fast?
To boost your credit score as fast as possible, there are a few key things to keep in mind:
1. Keep a low balance on your credit cards. If you’re carrying a lot of debt, it can be a red flag to lenders and hurt your credit score.
2. Have a diverse credit portfolio. Lenders like to see that you can handle different types of credit responsibly, which can improve your credit score.
3. Don’t many new credit accounts. When you open a new credit account, it can temporarily lower your credit score. So, if you’re trying to improve your score quickly, it’s a good idea to hold off on opening any new credit account until your score has improved.
4. Use credit builder services to help boost your credit. One that we recommend is Boom Pay; You can use your current and even past rent payments to help build your credit (typically normal rent payments don’t count toward your credit score).