The Latest Scoop on Renting and Your Credit Score

Whether you like it or not, your credit score affects your renting capability. The higher your score, the more likely you are to get a place, and the lower the score, the fewer options you’ll have. We’ve touched on this before: Alissa wrote about credit scores for renters, and I recently wrote about how to raise your credit score.

But we decided we wanted to get the inside scoop. How much does credit score really matter? I called three apartment brokers, one in Chicago, one in New York, and one in Los Angeles.

The news is both good and bad. First, the bad: credit score does matter, and it’s one of the main criteria that landlords look at, meaning that if you have poor credit, you’ll have to work extra hard to find an apartment.

The good: What I mostly heard is that if your score is in the 700 range, you can be pretty sure that you’ll get approved. But if your score is lower, even much lower, there are ways around it, and all three of the companies I talked with agreed that in the past few years, a lot of people have stumbled upon bad credit, so apartment brokers are used to dealing with this issue.

According to Maurice Ortiz, who works for Apartment People, a Chicago-based brokerage company, landlords look at credit score, past landlord history, and current income. These things are weighed about equally, so it’s possible that if you do well on the other two, you’ll be able to get a place. As an example, he said that in his company’s records he found that a few clients had successfully got rentals with credit scores in the upper 400s. (Credit score can range anywhere from 300 to 850, so the upper 400s is notably crappy – if someone can get an apartment with that score, so can you.)

That said, Danny Charles, of New York-based Citi-Habitats, stressed that a bad credit score can be a deal-breaker. Brokers will know which landlords have a no-tolerance policy with regard to credit scores, so make sure you are honest with your broker up-front. Otherwise, you’re wasting everyone’s time by having your broker unknowingly show you out-of-range apartments. And, as Ortiz pointed out, you’ll waste your own money paying the application fee, when your broker could have told you it was a non-starter. Finally, as Zaya of The Rental Girl in Los Angeles pointed out, if you do have poor credit and multiple people are bidding for an apartment, you’re likely to lose out. So, prepare for some frustration and keep your chin up.

However, Ortiz noted that many clients come into Apartment People’s offices convinced they have terrible credit, but when a credit check is run, it turns out that it’s not nearly as bad as the client thinks. So just because you’ve a few missed payments, don’t be convinced that your score is terrible: check first. 

But, what can you do if you’ve checked and you’re sure you have bad credit? Having current employment with a stable company and a good salary will help immensely. Or, you can also get letters of recommendations from previous landlords (provided they’re good recommendations). Or, particularly if you are a young renter, you can have your parents sign on as a guarantor of your lease – if your parents have good credit, likely that will suffice. (And, if you have no credit score because you’ve not yet built any credit, a guarantor is a common route to go.) Otherwise, there’s the option of paying an extra security deposit, extra months rent up front, or setting up an auto-pay, whereby your rent is automatically deducted from your bank account on a monthly basis.

Finally, Ortiz recommended that people with low scores try to work with private owners, rather than large management companies, since private owners are more flexible. And all three brokerage companies stressed that there is no magic bullet. There is not one credit score that is always too low – guidelines vary significantly by landlord. This means that the name of the game is flexibility, thinking of alternative ways to prove your credibility, and persistence. With all that in mind, it’s time to start the search!

 

Author My First Apartment
Alex

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Alex has rented in Minneapolis, Queens, Brooklyn, and now Chicago. He can kill rodents and roaches when required, and loves picture-hanging projects. If you're ever in town, give him a shout.

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Comments (1)

  1. The New Yorker

    This was extensively helpful. I plan on obtaining my credit score this month. I am not 100% sure where I am at. I do have a few missed payments with my old mobile company that I have to pay off asap, but other than that I have no other missed bills. I have very steady employment for years and have a history of paying bills on time (or even early). I hope I can find a renter in the near future who will accept me.

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