How to rent with poor credit
Everyone needs a place to call home, but if you have a low credit score, finding a new place to live may prove challenging. Buying a home is one option, but lenders reviewing your application will take note of poor credit and likely deny the request. There's always the option of renting. But in this case, some landlords will not rent to people with a bad credit history. Yet, there are ways for you to rent an apartment or house with bad credit.
Being honest and providing an explanation of your credit history before completing a rental agreement may satisfy a landlord, and they may consider renting to you with a poor credit history. Different factors bring on poor credit such as loss of income and medical problems. Knowing your background and the events that led to poor credit may convince a landlord to give you another chance.
Benefits of Renting with Poor Credit
Not every landlord reports rental history to the credit bureaus. However, if approved for an apartment or house with a bad credit history, ask your landlord to report your positive rental history to the three major bureaus. Having this information on your credit report helps raise a low credit score, wherein you're able to qualify for a mortgage in the future.
Letters of recommendations carry weight when applying for a house or apartment with poor credit. Have your present or old landlord write a positive letter of recommendation to your new landlord. This letter should highlight your good payment history.
Security deposits are common when renting a house or apartment, and landlords typically ask for one month's rent or a percentage of the monthly rent. If applying with bad credit, the landlord may request a higher security deposit because you pose a higher risk than someone with a good credit history. Higher deposits are useful if you decide to walk away from the lease agreement early.
Significance of Co-signing
Even if a landlord is hesitant to approve you for an apartment of house, there are tactics to negotiate an approval. Have someone on standby to cosign the rental agreement. By signing their name to the agreement, you co-signer agrees to take full responsibility for the apartment or house if you decide to terminate the lease early.