Although it can be difficult, renting an apartment with bad credit is not impossible. Be upfront with prospective landlords about your credit history, be ready to provide references and evidence of income, and be prepared to pay a larger security deposit or several months’ rent up front. This article looks at several options for those with bad credit who want to rent apartments.

Anyone occasionally experiences a difficult time. You now have bad credit, whether it was due to an unexpected, dramatic catastrophe or a gradual descent into credit mayhem. Despite the fact that you might believe it’s hard to rent an apartment with terrible credit, don’t worry! That could be more challenging, but it is still possible.

First thing you may want to do is to determine how bad your credit is. You can get a free credit report from annualcreditreport.com. You can keep an eye on your credit. This website is mandated by the government and is totally free. (Watch out for websites that want payment for your report. They’ll say it’s free but then demand your credit card number.)

WHAT IS A GOOD CREDIT SCORE?

Anything more than 700 is considered to be good. But let’s dissect that. Perhaps yours isn’t as horrible as you think! The range of credit scores is 300 to 850. The summary is as follows:

• “Very poor” refers to scores below 579.
• “Fair” ranges from 580 to 669.
• “Very good” ranges are 740–799
• Above 800 is considered “excellent.”

You should be aware of the three main credit bureaus: TransUnion, Equifax, and Experian. Your FICO score won’t be the same for all three because each calculates it differently.

What does FICO means?

TransUnion, Equifax, and Experian are the three main credit bureaus that you need to be aware of. As each one calculates your FICO score differently, you won’t have the same score across all three.

• Your financial history
• The duration of that past
• how much credit you utilize
• A breakdown of your credit (this predicts how well you handle different types of loans, such as a car loan, credit cards, mortgage, etc.)

Each of the aforementioned elements is given a weight, with your payment history accounting for 35 percent of your overall score as the most crucial component.

Your credit utilization accounts for another 30 percent of your credit score. Do you regularly use the whole amount on your credit cards? If yes, you use credit excessively. This shows that you don’t manage your debt in a responsible manner. Maintaining low (or zero) credit card balances is the greatest approach to raise this aspect of your score. Pay down these accounts instead of closing them. Credit cards are crucial for demonstrating your financial management skills (more so than a car loan because credit cards are revolving balances). Credit cards, on the other hand, also cause the most harm. You should keep your balances below seven percent. In otherwards, if you have one-hundred-dollar credit limit, only keep six dollars balance. Don’t carry balances.

Don’t close credit cards accounts. Why?

Why don’t you shut them then? Your “utilization ratio” is a factor in determining your FICO score. Your utilization ratio will rise if you keep that line of credit active with a negative balance. As soon as you shut the account, the line of credit is no longer available for use in calculating your overall score. If the bank or lender closes your card because you don’t use it, your credit may also suffer.

WHAT CONSIDERED BY LANDLORDS IN A CREDIT REPORT?

Landlords don’t just check your credit report’s credit score. Also, several elements like payment history, debts, bankruptcy, and evictions are taken into account. Personal information, such as your employment history, will also be included in your credit report.

Financial history
For a rental application to be granted, your payment history is crucial. Landlords want to know that you routinely make your payments in whole and on schedule. Frequent late payments, whether for a car payment, utility bill, or monthly rent, may raise a big red flag to a possible landlord.

rental record
The biggest predictor of how you will behave as a renter for a landlord is your rental history. Your rental history will include any unpaid rent, any payment details sent to a credit bureau, and the addresses of your prior residences, enabling your prospective landlord to get in touch with your former landlord.

Debts
Any debts or delinquencies will also be taken into consideration by landlords. Your rental application will cause the landlord to stop if you have high credit card debt, a repossessed automobile, or have been referred to a collection agency for a prior eviction. Student loan debt is often taken into consideration, but it doesn’t usually prevent you from getting approved for an apartment.

CAN A RENTER WITH A BAD CREDIT SCORE STILL OBTAIN AN APARTMENT?

You can still rent even if you have a low credit score, but you will have to accept lower rent. If you have a low credit score, it could feel unfair that you have to go through extra hoops to be able to rent a place, but try to imagine yourself as a landlord. In a sense, your landlord is gambling on each and every one of their tenants. The landlord will suffer a severe loss in income if you are late on your rent. Tenant and landlord relationships are mutually beneficial. If you’re prepared to work with your new landlord, you might already be in your new apartment.

So how can someone with bad credit rent an apartment?

• Don’t lie about your credit.
• Make sure you can afford the apartment.
• Provide proof of regular income and employment.
• Pay a higher deposit.
• Pay by direct deposit.
• Get a cosigner.
• Find a roommate.
• Get references.
• Provide proof of rental history.
• Find a no credit check apartment.

What can you do about your credit?

• Boost your credit score up.
• Lower your utilization.
• Hire a legit Credit Repair company.
• Get additional credit cards.
• Don’t be late on your credit cards payment.
• Buy tradelines.
• Hire a real estate agent or apartment service company.
• Get a credit building credit card.
• Add rent payments to your credit report.

Please leave this field empty

Free Apartment Search

Tell us what you are looking for. We'll search & notify you on the results & keep you updated.

We don’t spam! Read our privacy policy for more info.

Check your inbox or spam folder to confirm your subscription.