How to Get an Apartment With Bad Credit

Can You Get an Apartment With Bad Credit?

The short answer is yes, you can rent an apartment with bad credit. A low credit score presents additional barriers and challenges to getting approved for a lease, but it can potentially be overcome with a little extra research, effort and determination.

What Credit Score Do You Need to Rent an Apartment?

Like lenders do when evaluating a credit application, landlords check your credit when you apply for an apartment to determine your ability and willingness to pay your bills on time. They want assurance that you'll pay rent punctually and as agreed before they decide to rent to you.

The higher your credit score, the better chance you have to get approved for a rental—especially in competitive markets. Landlords generally prefer good credit, meaning FICO Scores of 670 or above. If your credit score is lower, you may still be able to rent an apartment, but potential landlords might take a closer look at other aspects of your finances when evaluating your application.

What Do Landlords Look for on a Credit Report?

In addition to reviewing an applicant's income details and criminal history, landlords typically run a credit check. They use credit scores to gauge how much of a risk the potential tenant is; higher scores are considered safer, while lower scores present higher risk.

What else do landlords look for besides that three-digit number? They'll usually review payment history to see if you have a track record of paying your bills, loans, credit cards and other items on time. If you have negative marks for frequent missed or late payments, it can be a red flag that you might struggle to pay rent on time too.

They may also consider your debt load and your debt-to-income ratio to ensure you have enough cash on hand each month to afford rent. If your prior rental history was reported to the credit bureaus, the landlord can also see your rent payment history.

Landlords also want to make sure your credit report is free of larger problems that could make you a risky tenant. This could include prior bankruptcies, loan defaults, charge-offs, foreclosures and repossessions.

How to Rent an Apartment With Bad Credit

Here's how to position yourself as the strongest applicant and get your apartment in spite of your credit.

1. Pay More Upfront

Most landlords and property managers require a security deposit and the first month's rent upfront. To help overcome a bad credit score and build trust, consider offering to pay two or more months' rent in advance or offer a larger security deposit.

Paying more in advance will also put you ahead of the rental schedule and potentially act as a buffer if you have trouble paying rent one month in the future.

2. Provide Documents and References

Your credit score is just one part of the story that makes up your consumer profile. If your score is low, submit documents with your application that tell the rest of the story and demonstrate that you are a credible applicant capable of paying your rent every month. This could include:

• Proof of a responsible rental history: Bring copies of payments you've made for your last rental, if applicable. Your previous landlord may not have reported your payments to the credit bureaus, but bank statements can prove you've made on-time payments.
• Recommendation letters: Request reference letters from past landlords, property management companies, employers, colleagues or roommates to attest to your character. Just make sure your reference letters are from credible, relevant sources.
• Proof of employment: A landlord will likely ask to verify you're employed, so you can bring pay stubs going back several months, your latest tax return or a letter from your employer to prove you have steady income.
• Utility payments: Proof you've made your utility payments on time every month can also show you're reliable and consistent.

3. Find a Cosigner or Guarantor

If your credit just isn't cutting it, you could ask a family member or close friend with good to excellent credit to cosign. A cosigner, sometimes called a guarantor, signs the lease with you. While they won't live with you, they agree to pay your rent should you default on the rental agreement.

If you find someone willing to cosign on an apartment with you, make sure they have good credit and a history of timely mortgage or rental payments. Because it's a risk for the cosigner, make sure you can financially commit to your monthly rent payment since failing to do so can hurt both of your credit—and your relationship.

4. Get a Roommate

If you're trying to rent an apartment with bad credit, a landlord may be more willing to accept your rental application if you share the rent with one or more roommates, especially if their credit scores are higher.

Another option is to find an arrangement where you move in with someone who already lives in an apartment or rental property. You may still have to undergo a credit check, but your payments will be lower than if you were to rent on your own and your roommate may still assume responsibility for the apartment depending on the setup.

5. Search for Apartments That Don't Require Credit Checks

Most established property owners require a credit check before they'll rent to you. There are, however, rentals that do not require a credit check. You're more likely to find this with individual landlords rather than larger property management companies and apartment complexes.

To find a place that doesn't check renters for bad credit or no credit, you could look at online rental listing websites or your local newspaper's classified ads, or by driving around and looking at for-rent signs. If you're patient and do a thorough search, you might find a place where your credit report isn't screened.

If you have a very low income, you might also explore if you're eligible for the federal government's Housing Choice Voucher program, also known as Section 8. Participating landlords may have more lenient requirements than with traditional renters.

You might have to adjust your expectations a bit, perhaps going with a smaller property, a rental in a less desirable part of town or one with fewer amenities. But it can help to view this as a period of rebuilding and fixing your bad credit so you can land your ideal abode next time.

How to Improve Your Credit Before Getting an Apartment

If you're still unable to get approved for an apartment, it may require staying in your situation for a bit longer as you work to improve your credit score before trying again.

In the months leading up to applying for a rental, take these steps to get your credit in better shape:

• Pay all bills on time. Payment history is the most important factor in your credit score, so making all your payments on time every month will help your score improve and show a strong credit history. Creditors and landlords like to see consistent payments over a long time.
• Reduce your debts. If you have credit card debt, student loans or other outstanding debts, it helps to focus on paying off as much debt as possible before applying to rent. Reducing your balance by paying down your debt can help raise your score.
• Monitor your credit. Sign up to monitor your credit reports, which is free with Experian. You'll be able to see the positive and negative marks landlords see, along with insight into how to improve your credit score. Over time, you'll see how your actions impact your report, and how your efforts can translate into higher scores.

Get Credit Where Credit Is Due

One last tip: Consider signing up for Experian Boost^®ø to improve your Experian credit file before applying for an apartment.

Experian Boost gives you credit for an array of bills you already pay, but which normally don't count toward your credit score. They include eligible streaming services, utility bills and some insurance payments. Additionally, if your landlord or property management company uses certain online rental payment platforms, it can also contribute to your credit with Experian Boost.