Renting your first apartment is an exciting life event, but sometimes it can feel like an unachievable dream. Landlords will often want to look at your credit score before considering your application. But what do you do if your credit score isn’t quite up to scratch yet?
Fortunately, renting an apartment with “bad credit” is possible. Here’s how.
What Is a Bad Credit Score?
Before we get started, let’s first figure out what bad credit actually is. In both the U.S. and Canada, credit scores start at 300. They go up to 850 in the States and 900 in Canada. In the U.S., a credit score of 620 is considered fair, while Canadian lenders and landlords consider a score of 660 or more as trustworthy.
Most landlords and lenders in the U.S. consider any score below 580 to be a poor credit score, whereas, in Canada, a bad credit score is 574 or less. If this describes your credit score, don’t worry. It’s still possible to rent an apartment. You just might have to take a different approach.
Offer to Pay More Up Front
When you rent an apartment, you’ll typically be required to pay a security deposit and one month’s rent upfront. However, if you have bad credit, some landlords and property managers will allow you to pay two or three months’ rent in addition to the security deposit. This helps gain their trust and gives them peace of mind that you’re serious about your financial responsibilities.
It also gives you a bit of flexibility, putting you ahead of your rental schedule. You may even be able to arrange to use the extra cash as a buffer in case you face financial difficulties in the future. Just be sure to get everything down on paper and in the lease agreement.
Use Supporting Documents and References in Your Application
If you’ve rented previously or have a stable job, it can be easier to convince a property manager or landlord that you’ll be able to keep up with your monthly payments. Remember that your credit score is just one element of your overall credit record. By providing supporting documents and references, you’ll be able to show potential landlords a more complete picture of your financial situation. Here’s what to bring:
- Pay stubs: The more you provide, the better, so try to give several months’ worth of records. This shows you’re in stable employment and have the funds to manage the rent.
- Evidence of previous rental experience: Bring copies of the payments you made if you’ve rented before. Bank statements can also help, as well as proof that you paid your utilities on time.
- Recommendations: A good character reference will always help a landlord arrive at a decision. Speak to previous landlords or management companies, as well as employers or other business associates.
Ask Someone to Co-Sign
Finding a reliable co-signer can make it much easier to rent an apartment with bad credit. The co-signer will often be someone you know, such as a family member or friend, but it’s essential that you both know what you’re getting into. Co-signing presents a risk for the co-signer. Since they share financial responsibility, their credit record will also be impacted if you don’t make a payment.
The ideal co-signer will have a good credit score and a history of making payments on time, such as mortgage and credit card payments.
Think About Sharing
Sharing an apartment with a roommate can be a great way to rent with bad credit. Landlords and property managers are more willing to accept applicants with poor credit if they share the rent with another tenant. Since your rent will be lower, there’s less risk that you’ll miss a payment.
Alternatively, you might consider subletting from someone who is already renting. This way, your roommate will take responsibility for paying the rent while you pay them. Of course, you may still have to have a credit check, but it’s typically less stringent than if you were looking to rent by yourself.
Interested in renting an apartment in some of the most popular American and Canadian cities? Visit the links below:
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Apartments for rent in Chicago
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Apartments for rent in Windsor
Apartments for rent in Saskatoon
Apartments for rent in Richmond Hill
Apartments for rent in Montreal
Apartments for rent in Mississauga
Apartments for rent in Kitchener
Apartments for rent in Toronto
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Apartments for rent in Regina
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