Why You Need Credit To Rent An Apartment

Why do you need credit to rent an apartment? A solid credit score plays a significant role in getting you into your dream apartment. A bad credit score, on the other hand, can limit your options and prove to be an obstacle in your search for a new home. Credit history shows apartment managers that you are a trustworthy applicant who will make payments on time.

Your credit history, report, and score provide insight into your reliability and your experience thus far in managing your money. Data available through a credit check includes the history of on-time bill payments, balances on credit cards or loans, foreclosures, repossessions, and more. Apartments look at credit scores to determine that you are financially responsible. They want to make sure you can be trusted with the responsibility of paying rent each month.

What Credit Score Do You Need to Rent an Apartment in Colorado in 2017?

If you need credit to rent, what credit score are property managers expecting? Depending on the price range of the apartment, managers typically like to see a credit score that at a minimum ranges between 620 and 675.  This helps them feel comfortable renting to you with no additional stipulations. According to a study conducted by the Federal Reserve Bank of New York regarding average credit scores throughout the US, Colorado’s average was 689 at the time. Ideally, you want your credit score in the mid-600s or better. Of course, anything higher than that is always preferred.

If your credit score is just below that range, there are other ways for management companies to mitigate their risks and still rent to you. If you apply with a credit score of 580, the rental agency might just ask you to pay more money upfront in the form of a larger deposit. Applicants with bad credit scores or no credit are often better off applying with a cosigner. A cosigner is someone with a healthy credit score who will legally assume the financial responsibility of renting the apartment.

Many apartment management companies list a minimum credit requirement on their website, while others choose not to disclose that information. You will need to check with management on individual requirements for both the principal applicant and any co-signers.

Renting An Apartment With Bad Credit Or No Credit

Property managers aren’t looking for perfect credit history. However, there are a few red flags that consistently get applicants turned away. Credit cards being charged off and car repossession are good examples of credit blemishes that could get your application denied. Minor mistakes, like late payments on an account that’s gone stagnant, matter less. Other factors that impact the outcome of your application include your income level and the history of any evictions or criminal convictions.

Renting with bad credit depends mostly on why your credit is low. If your credit is low because of things like unpaid medical bills, late student loan payments, or being jobless due to injury, an apartment manager isn’t going to weigh your low credit score as heavily. They’re mostly concerned about signs of chronic financial mismanagement. Even with poor credit, you still have a chance of being approved by getting a co-signer, advancing rental payments, or making a larger security deposit.

If your credit score is low, you may be asked or required to boost your application by:

  • Paying a higher deposit equal to a full month’s rent, if not more.
  • Paying 1-3 months of rent upfront
  • Having a co-signer
  • Providing proof of a steady income and income history

Extremely low credit scores, such as those in the low 500’s or lower, carry a higher risk of being denied. Speaking to the apartment complex concerning your credit history could help, but that is not guaranteed.

Renting With No Credit

In some cases, you don’t absolutely need credit to rent as long as someone else on the lease does have credit. If you have no credit at all, you’re going to need to find a friend or family member who’s willing to act as a co-signer. Responsible apartment management companies will not feel comfortable entering into a leasing agreement with someone who does not have a financial history. After making enough payments on time, your landlord might be willing to remove your co-signer from the lease.

Northern Colorado Apartment Management

Finding an apartment can be competitive, especially if you’re targeting choice locations in growing communities. While a credit score of 650 is typically high enough to meet most apartment management company’s minimum requirements, it is not guaranteed. Contact All Property Services, Inc. for any questions regarding bad credit or low credit on apartment applications in Fort Collins, Loveland, Greeley, Windsor, or Wellington.

credit-report-to-rent
All Property Services, Inc.
Read previous post:
apartment home security
Apartment Home Security: Tips for Apartment Living Safety

Close