Having a bad credit score can affect your financial status in more ways than one. You’ll have a hard time applying for a loan, and once your application is approved, you’ll be forced to pay higher rates and comply with restrictive terms. Getting a security clearance or phone contract can also become a problem.
But contrary to popular belief, you can still rent an apartment even when you have bad credit. As long as you know where to search and what strategies to use, it won’t be long before you can live in a comfortable place that fits your lifestyle and current financial health.
Here are some ways for you to rent an apartment even with bad credit:
1: Search For Apartments That Don’t Check Your Credit Score
One of the easiest ways to rent an apartment even when you have bad credit is to look for ones that don’t require your credit standing. Apartment complexes that are owned and managed by established property management companies will always require their tenants to undergo a credit check. You should steer away from taking this direction and look for better options.
Instead, you should consider renting apartments that are owned by individual landlords as they have a more lenient screening process for their tenants. Most of these landlords will look into your current financial standing and renting history rather than solely focusing on your credit score. Second Chance Apartments, for example, can offer different types of apartments regardless of the credit score of the tenant.
You can expand your search by using online sources, checking with local real estate agents, or personally scouting around the neighborhood where you’re planning to move in.
2: Have Someone Vouch For You
As mentioned, a bad credit score can affect your life in a lot of ways, but having someone vouch for your financial standing and financial responsibility can make a huge difference. Having someone to recommend you can overpower your bad credit score.
If you’re leaning towards this direction, determine the names of the persons whom you’ve made financial relationships with and ask if they can provide a reference letter. The letters could be from your previous landlord, employers, and bank.
Before handing out any reference letter, make sure that the landlord is actually asking for one. A landlord might become suspicious if you start explaining your financial problems in the past or if you show them without being required.
You should only provide reference letters to the landlord if they ask for it or if they start checking your credit score. Landlords will get your permission before they look into your credit report, so you’ll know when is the best time to prepare these reference letters.
3. Prove That You Have Stable Income
Landlords don’t accept people with a bad credit score because they fear that these tenants aren’t financially capable of paying rent. Accepting a tenant with a bad credit score is a big risk some landlords choose to take.
To prove your financial capabilities, have a steady and provable income. Earning a sufficient amount of money every month can conceal a bad or negative credit history. To do this, provide documents showing that you regularly earn thrice the amount of your monthly rent. Your payslips for at least three months will do. If the landlord requires you to pay $10,000 every month, your regular income should be at least $30,000.
Earning this amount of money will not only meet your landlord’s requirements; it can also guarantee that you can pay your monthly rent on time.
4. Be Ready To Pay More Up Front
As mentioned, finding an apartment when you have bad credit is always a challenging yet achievable goal. Aside from having limited options, you’ll also have to prove your financial capability to your lessor – and paying more upfront is one of doing it.
If you found the “perfect” apartment and you’re willing to take extreme measures just to live in it, offer to pay a higher price than the monthly rent. If you’re eyeing to rent an apartment that costs $10,000, offer the landlord to pay $12,000 every month.
Depending on your monthly income, you can even opt to pay a year’s worth of rent upfront. Paying more than what is required serves as your security deposit, and can put your landlord’s mind at ease.
Improve Your Credit Score No Matter What
Even if you find an apartment that accepts people with bad credit, you should gradually work on improving your financial health. Improving your credit score might require a lot of time and effort, but once you’re successful with this task, moving to another residence will be easy in no time!