How to Rent an Apartment with Bad Credit

We want to show you that renting an apartment with a poor credit score is possible. It can be challenging, but it is possible to lease again, even if you have defaulted on your rent. Renting an apartment is a simple process if you have good credit. However, everyone does not have good credit and still needs to live somewhere.

You can do several things to have a better chance of success in renting an apartment or home. Be prepared, and keep going even if you get some rejections. Remember, people rent with lousy credit daily, and you can be one of them.

Things to Consider When Renting

Give a Reason for your Poor Credit

It is essential, to be honest with the property manager. They will find out anyway when they run a credit check. Before they run your credit, explain the reason and prove why you have a poor credit history. A history of late or missed payments can only satisfy you if you have an acceptable explanation for your situation. Individual landlords may reject your application, or some may require a higher security deposit.

Many people have a poor credit history because of no fault of their own

You may have recently divorced, or your spouse is deceased, or you had to flee domestic violence, etc. Make sure you have all your documents to confirm your story. Your potential landlord will work with you, even if you need better credit. Also, check out How to Apply for Government-Assisted Housing

Pay Off Previous Rental Debt

Most apartment agencies will only lease you once you have paid off debt to a previous property owner. Paying off any past rental companies is mandatory.  When a real estate agent sees that you left an apartment owing rent or negative charges, they assume you are a risk. Paying off old rent payments is good faith and accountability.

So, you first want to pay anything you owe the previous landlord or make an arrangement to pay. If you know you will move in six months, begin paying that debt now. Talk to the creditor and ask them to list your debt as “paid in full” or removed after you pay them off. Many will agree to this as they want their money.

Show them the Money

You must be more creative if you are trying to rent an apartment with bad credit. It will help if you prove to the apartment manager that you have rehabilitated and are no longer a rental risk. Often a higher deposit will be required Or paying for four to six months of your lease in advance.

Being credit poor does not necessarily mean you have no access to money. For instance, if you rent the apartment for six months, the landlord may require 4 or 5 months’ rent upfront. Many noncitizens with no credit history or social security card pay rent in advance.

Look for Private Renters

Private renters will do a credit check, and you must have no delinquency on your credit cards. However, if they check your credit and there is a minor issue, let them know you will put up a sizeable deposit to get the apartment. Or, if renting a home, ask for a month-to-month lease.

If you can pay the additional deposit, it will allow you to establish an excellent rental history for the next time you move. Of course, you must pay your rent on time every month and comply with all terms of your rental agreement. Check out how to get rental assistance from HUD.

Use Positive Rental History

Get letters of recommendation from people you have successfully rented from to prove you are a great tenant who has paid your rent on time. Your history will help prospective renters to see you have paid rent on time for several years. Renters will also be able to see a previous eviction was a one-time situation and that you are steady. Some renters will give you a second chance, especially private renters.

Co-Signers can Help you Rent with Bad Credit

You can rent an apartment if you have a family member with excellent credit willing to co-sign and a solid income. People do not like to co-sign for other people’s debts. You have to know someone pretty well for them to take a chance on you.

Get someone to co-sign for you. A co-signer is a legal renter along with you. Make sure you are in good standing with the co-signer, as they can pull out of the agreement at the end of your lease if there have been any problems, like late rental payment, which will affect the cosigner’s credit. You can sweeten the offer with the co-signer for the first year by providing collateral such as a car, boat, etc.

Start Improving Your Credit Now

To avoid renting an apartment with bad credit, change the narrative. There is no time like the present to begin developing good credit. Find out what you owe. Check out Creditkarma.com to get an idea of your credit situation. It is free, and you can see what is in the collection and any positive credit you have established. Find out which items will fall off and concentrate on newer debt. You may have several collections companies on your report.

Start By

• Confirm your debt is genuine
• Deal with one creditor at a time
• Challenge anything that is not correct
• Look for items about to fall off soon
• Request the name of the name, the date of the debt, and the id number for the original debt
• Contact the original debtor to confirm the date and item number on your credit report

Get a secure credit card from your bank to begin re-establishing credit. Only use about 10% of your card balance. A secure credit card is to prove you can handle financial responsibility. Use the new card as a tool to better credit. It is good to take one small bill and have that amount automatically deducted each month from your card. Then put the credit card away. After one year, your bank will re-assess if you are eligible for a regular credit card.

Finally

Paying your bills on time affects getting a job, buying a home, and renting an apartment.  However, there are ways to navigate minor issues when renting an apartment or home.  Before filling out a rental application, be upfront and honest with the leasing agent.

Speak to those who can help as co-signer in advance so that when you apply for housing, they can hold that apartment for you until you get the agreement papers signed.  Inform your agent if a fire, flood, or unsafe environment has displaced you.  Of course, you would not be expected to pay the rent in these cases.