Renting with Poor Credit – Part I

June 28, 2011 | Apartment Hunting, Apartment Hunting Advice

Renters with poor credit should expect that it will take them a bit longer to secure apartments for rent than those with good credit, but there are definitely landlords willing to rent to people with very poor credit. If there weren’t, millions of people would be homeless. However, if you are concerned about your credit and you know that a credit check is standard procedure for your potential landlord—which is typical these days—there are a few things you can do to make yourself more attractive as a prospective tenant.

Six Tips for Renting with Poor Credit:

1. Get a Letter from Your Landlord: If you are currently renting a property elsewhere, ask your current landlord for a letter of reference. If you have had several landlords in the past, give them a call to request letters as well. Despite your credit score, a letter of reference from previous landlords of rental properties that speaks to the following can really help:

   • Your track record for paying rent on time
   • Your respect for both the property and the neighborhood
   • The length of time that you resided at each property
   • Contact information so the landlord can be reached directly

2. Be Honest: Keep in mind that having poor credit does not mean that you are or will be a poor tenant. With foreclosure rates increasing, there are many victims of less than perfect credit who are struggling, but are still responsible and trustworthy people. Be honest with your landlord about why you have a low credit score, and determine what “proof” of overall stability is needed to sign a lease.

3. Letter from Your Employer: It is important to provide proof of your job security, and thus your ability to cover the monthly rental payment and pay rent on time. While not all employers’ policies allow for providing such letters, if you can get an employment verification letter, it should include:

   • How long you have worked for the employer
   • Your annual salary

4. Pay a Larger Deposit: By offering a larger deposit, landlords may feel safer that you are financially secure and that there is less risk of breaking the lease. If you can afford it, offer your landlord 3-6 months of rent up front, in addition to the standard one month rent plus security deposit. This will allow for your landlord to rest easy for a few months. If 3-6 months of rent in advance is not in your budget, offer to pay a larger security deposit.

5. Offer Month-by-Month: If a landlord is unwilling to rent to you on the longer 12-month lease, ask if it is possible to negotiate a month-by-month lease for the first few months. This strategy will not only put your landlord at ease, but will also allow you some time to prove yourself as a responsible tenant.

6. Offer Automatic Payment of Rent: Offer to set up an automatic payment from your bank on the first of each month to pay for the rent. Often a landlord will feel more comfortable accepting a tenant with less-than-perfect credit if they know that payment for their property rentals is scheduled to automatically come out of their tenants accounts each month.

Good luck with your apartment search and stay tuned for our next post in this 3-part series on credit. Next up, we’ll share more about what landlords are looking for on your credit report.

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