Apartment Hunting With Bad Credit

Many people in this world have bad credit, but they have to live somewhere. While landlords usually frown upon bad credit, there are ways around it. Don’t let a broken lease or other financial issues keep you from getting an apartment by following these tips.

Rental History
Landlords often overlook problems with credit scores in favor of a good rental history. Character references show that you are dependable and can pay rent on time. If you don’t have a rental history, establish one by renting a room or paying your parents for living at their house. Make sure to keep all receipts.

High Income
If you have money in your bank account or have a good annual salary, a landlord is more likely to overlook credit scores that are below the healthy median. A good annual salary is more than 40 times of the monthly rent. For example, if your rent is $2,000 monthly, a salary of $80,000 a year qualifies. It’s also a good idea to keep an online renter profile on a site like Trulia. Just make sure you can verify everything, including your income.

Pay Upfront 
When renting, it’s typical to pay a security deposit in addition to the first month of rent to even get into the door. If you have bad credit, offer to pay more in advance. In addition to the security deposit, offer twice or three times the amount of monthly rent upfront.

Automatic Payments
Landlords relish getting money via automated clearinghouse (ACH) debits. Since ACH payments move between banks, signing up for automatic payments can get you that apartment you desire. However, this will only work if you have the money in the bank account each month to cover the bill.

As long as they manage all potential renters the same, landlords can make exceptions. Be honest and explain upfront that you have a low credit score and the reasons behind it. Keep in mind that you’re more likely to be able to negotiate with individual proprietors as opposed to big property companies.

If all else fails, ask for a co-signer with a good credit score. A parent would be ideal. However, if you don’t pay the rent, the landlord will ask the other party to do so. Additionally, if your rental history contains a broken lease, you can look for second chance apartments with short terms, and work your way up from there.