Bad credit can trigger all sorts of issues when trying to get a mortgage, purchase a car or get a credit card. But even if you’re just looking for an apartment or house to rent, your credit history can pose problems.
Most landlords check credit reports of potential renters to determine the probability of receiving the rent payments. This can pose a problem when you may have a repossession, charge-offs, foreclosure, late payments or a Bankruptcy listed on your credit report. When your credit is damaged, you may have a tough time qualifying for that home or apartment that you and your family need.
At reScore Solutions, we understand that many people have fallen on hard times due to job loss, health problems, or having to close a business. Bad credit can happen even when we do our best to pay our bills on time.
Call us so for a free no-obligation credit report evaluation. While you are trying to get your life back on track, we can get your credit scores back up and running.
We specialize in getting your credit reports lender-ready so that you will be approved for a home. Understanding the ins and outs of lending we know what it takes to get your credit reports repaired and credit scores to the specification of your lender.
What should you do if your credit history is less-than-stellar? Here are seven ways you can overcome your bad credit and still get that rental you’re looking for:
1. Be honest and show that you have been making progress.
Sometimes bad credit isn’t a reflection of poor money management. Be upfront with a potential landlord before your credit is pulled. Don’t make excuses and blame others. Landlords have heard all of the blame games. If you are able to show a valid reason why your bills were not paid on time, such as divorce, health, job loss; but also show that it was a temporary situation and show how you have been able to get back on your financial feet, you may have a better chance of getting approved.
2. Find a guarantor or co-signer
Ask a trusted friend or relative with good credit to co-sign the rental application with you. While you may be the only one living in the home or apartment, your co-signer will be financially responsible if you do not pay your rent. This may give the potential landlord the extra security that he needs to feel comfortable with renting to you.
Of course, you really don’t want your co-signer having to pay your rent, so be sure that you not over obligate yourself to a rent amount that you can’t comfortably afford.
3. Pay in advance or increase your security deposit
Bad credit and especially a consistent bad credit history makes a landlord nervous because it indicates that your actions in the past may be repeated, such as defaulting on the rent payments or not paying on time. By paying a month or more in advance or offering a two-month security deposit, you can possibly alleviate their concerns. Not only does this show your commitment, it also provides them with extra cash that can cover some of the losses and damages, should you skip out on the rent. (Which, of course, you won’t.)
4. Get a roommate
Willing to share your space such as kitchen, living room? If so, a roommate may be a great solution. If the landlord will allow just one person to sign the lease, see if your roommate is willing to sign it solo. (Alternately, try to move-in with a roommate who’s mid-lease.) This way, the person on the lease is the one with more solid credit.
The other benefit to having a roommate is sharing the utilities. Saving money will help you to pay down your debts and helping to repair your credit.
5. Show solid income and offer to pay via direct deposit
Even if your credit is a little weak, your landlord may feel better if you can show that you have history with a full-time job with good pay.
When applying for an apartment, have proof of income ready, such as recent pay stubs, tax returns and a letter from your employer verifying your employment status and income. Offering to have your rent automatically deducted from your bank account can also help.
6. Be willing to pay a little more
Some landlords, even if you are renting from a property management company may charge additional “risk” fees for shaky credit and poor credit scores. You may want to step up and pay more if you really love the home or have to move in a hurry.
If you are dealing with an individual, you may want to negotiate to pay a higher amount so that your application is not denied.
7. Letters of recommendation
Just as your would provide a letter of recommendation for a job, provide one for a potential landlord too. Ask for letters from current and previous employers, current and previous landlords, and even past roommates who can vouch for your character. Even if your previous landlords were only for short-term arrangements, their endorsement can hold weight.