How To Get An Apartment With Bad Credit?

Renting an apartment with bad credit scores (i.e., in the 300–570 range) is not easy, but it's not completely impossible. You can get a decent deal if you can provide strong income proof, have a co-signer (with good scores), or pay a substantial deposit.

Typically, landlords look for reliable tenants, and a good credit score can certainly strengthen your chances. However, some landlords may be willing to look past your poor credit history as long as you can prove to be a good tenant and back it up financially.

In this blog, we’ll discuss in detail “How to get an apartment with bad credit” and ways to improve your credit scores in the meantime for a more favorable scenario. 

What Is The Ideal Credit Score Range For Renting An Apartment?

Generally, a 620 credit score is considered good. However, the most suitable credit score for renting an apartment ranges from 670 to 739 (FICO score) and 661 to 780 (VantageScore®).

However, if your score is in the lower ranges, i.e., 300–579 (FICO score) or 300–660 (VantageScore), it doesn’t mean you can’t get approved. It just means that you may need to take some extra measures when submitting your rental application.

How Does Credit Impacts Your Chances Of Renting An Apartment?

A credit check is generally part of the rental application process. This is an essential step, as the landlords want to ensure your reliability and minimize the financial risk. So, they usually assume that if the renter has a high credit score, they are more trustworthy and highly likely to pay the bills on time. Though it’s not the only factor they assess your application on, it’s an important one. Therefore, high or low credit scores significantly impact your chances of getting an apartment.

What Are The Key Factors Landlords Look For On Your Credit Report? 

Landlords usually evaluate rental applications based on the following aspects:

1. Rental History

The landlord would be interested in knowing whether you have a good rental history. This means if you have broken a lease previously, have an account with the collections agency for overdue rent, or have any eviction record, it can raise some red flags.

2. Payment History

Before renting, landlords are usually concerned with getting timely rent. So, your payment history plays a crucial role in determining whether you are a reliable tenant or not. 

3. Late Bill Payments

Many landlords also ask for proof of payment like utility bills, etc. Therefore, if you have any late payments or unpaid bills on your credit report, it can impact your chances of renting negatively.

4. Overall Debts

Your debt-to-income ratio represents how financially sound you are. Hence, they also look to see if you have any ongoing debt or closed accounts.

5. Delinquent Accounts

If you have any account with more than 30 days past due payment that gets reported by the creditor, it will appear as a delinquent account on your credit report. It may not get in the way of renting an apartment with bad credit, but this may mean that the landlord would require a larger deposit upfront.   

6. Past Bankruptcy

Landlords usually consider someone with bankruptcy on their credit report as a high-risk tenant. However, providing solid income proof and paying a large deposit can help show that you are financially responsible.

7. Other Negative Items

Landlords carefully assess applicants who have any negative items on their credit report. Any derogatory remarks on your credit report—foreclosure, tax lien, judgment, repossession—can be a huge red flag. 

So, if you have one or more of the above negative items on your credit report, you might be thinking, “Can I get an apartment with bad credit?”. Well, this requires an effective strategy. 

How To Get An Apartment With Bad Credit?

Renting with bad credit requires some extra effort, so we have compiled a few ways it's possible:

• Find A Private Landlord 

Rental companies and apartment complex facilities usually require a thorough credit check along with income proof. However, a private landlord may consider renting with bad credit, but only if you can back it up financially. Thus, you may have a better chance of renting from an independent landlord.

For this, you can look online for listings on Craigslist, Facebook groups, or recommendations from a friend.

• Look For A Sublet

Another way is to find a renter who wants to sublet their apartment. In that case, they will be the original renter on the lease, so your bad credit may not be a problem for the landlord. The original renter will be responsible until the lease expires. However, you still have to undergo a credit check and provide sufficient financial proof to get approved.

• Housing Programs For Low-Income Individuals

You can also explore the rental housing programs by the United States government. The government and non-profit housing assistance programs may be ideal for low-income individuals, such as:

• Housing Choice Voucher (Section 8): For families with low incomes, seniors, and people with disabilities 
• Subsidized Rental Housing: To help low-income adults explore local affordable housing options
• Public Housing: U.S. citizens and eligible immigrants may also look for public housing properties for rental.
• Rental Assistance For Specific Groups: These are special rental programs for specific groups, such as veterans and individuals with special needs or disabilities. 
• Non-Profit Housing Programs: Individuals can also explore the HUD-approved programs and those provided by the Housing Assistance Council (HAC). These are nonprofits that support affordable housing efforts nationwide.

How To Improve Your Chances Of Getting Approved For An Apartment?

Here are a few tips that can help present yourself as a reliable renter and negotiate a decent agreement with the landlord:

1. Ensure Finances For A Substantial Deposit

Submitting an extra month’s rent as a deposit or paying a substantial amount as security is usually required for renters who have bad credit. Therefore, to strengthen your chances of getting approved, appropriate financial planning is crucial. Your credit scores may take some time to improve, so it’s best to set aside some money regularly to pay rent upfront and save for future rent.

2. Find A Reliable Co-Signer 

Even if you do not have perfect credit scores, you may want to consider signing the lease with a co-signer who has good credit standing. This can be parents, other family members, a spouse, or a friend. This means the landlord can rest assured that they will have a backup who can support you if you miss a payment.

Word of caution: The co-signer will be responsible for paying the rent in case you are unable to cover it yourself. Hence, defaulting may not impact your credit score, but it can hurt the credit score of the co-signer. Therefore, it is crucial to discuss the matter wisely before taking this step.

3. Provide Supporting Documents And References

When your credit score is poor, it’s crucial to provide adequate income proof and demonstrate financial stability to assure landlords that you can cover the rent. The following are the relevant documents you should submit:

• Pay stubs
• Income-tax returns
• Latest bank statements (to show you have adequate funding)
• Reference letters from the previous landlord
• Letter of recommendation from your employer (preferably the current one) as a professional reference can help strengthen your chances.
• Utility bills (record of timely payments)

4. Work On Improving Your Credit Score

When a landlord runs a credit check, it is known as a hard inquiry that can hurt your credit scores further. That’s why it’s a good strategy to work on rebuilding improving your credit scores in the meantime. 

For this, it is highly recommended to analyze your credit report and the factors that are affecting your scores poorly. In this case, the DIY AI-assisted CoolCredit app can be helpful. The AI-powered system not only fetches your credit report in seconds but also provides a list of negative items on your credit report. Additionally, the credit repair app suggests actionable strategies on how to eliminate each issue with step-by-step comprehensive guidance. 

How Does CoolCredit Help Raise Your Credit Scores?

It’s simple. You need to follow these steps:

• First, download the app and enter the required information to retrieve your credit report.
• CoolCredit can fetch the report from all 3 major credit bureaus—Experian, Equifax, and TransUnion. 
• The app will notify you about the issues in the credit report. 
• Click on the particular issue and after the AI analysis, it will provide insights into what you can do to remedy the situation.
• If you find any inaccuracies or wrong information in the credit report, you can use the in-app dispute letter templates to raise a dispute. This helps minimize the hassle of drafting a dispute letter from scratch.

This Free DIY credit repair app lets you work on improving your credit standing without involving any third-party credit repair agencies. However, if you require assistance from a credit expert, you can opt for its “Expert Assist” service for a more personalized service.

Conclusion

It can be a nightmare when you are apartment hunting with bad credit. The renting options can be limited and/or nearly nonexistent, especially when you want a no credit check apartment or housing. But by taking the right steps, you can get an apartment with bad credit. Planning your finances in advance, accumulating funding, and signing a lease with a co-signer or roommate with good credit are a few strategies that work. Additionally, you should also work to improve your credit score with CoolCredit—the DIY way to repair your credit with AI assistance.

FAQs

Q: How Does Credit Standing Impacts Getting Approved For An Apartment?

A: Good credit indicates satisfactory financial credibility, so the higher your credit score (i.e., 670+), the better your chances of successful approval. A low credit score translates to fewer chances of approval and more chances of your application process getting dragged for too long.

Q: What Do Landlords Look For On Your Credit Report?

A: Landlords may use the credit report to verify your identity and past credit behavior. They look for any payment gaps in your credit history. They also use the credit report to check for public records, such as prior bankruptcy, tax liens, and official judgments (if any). 

Q: Can I Get An Apartment With Poor Credit?

A: Yes, you can. Though it may be challenging, strong determination, willingness to pay a larger security deposit, and extra efforts to improve your credit scores can help show the landlord your sincerity. This may make them more willing to evaluate your application.

Q: Is 500 A High Enough Credit Score For An Apartment?

A: Yes, you can. Unfortunately, 500 falls under the poor credit score category, i.e., 300–579. So, if your credit score is lower than that, it's time to work on it. For this, the DIY credit repair app CoolCredit just might be what you need.

Q: What Is The Lowest Credit Score For Renting An Apartment?

A: There’s no specified minimum limit. However, any rental application with a credit score below 600 gets rejected in most cases. A 670 score is generally considered good for renting or buying an apartment. 

Q: Can I Reapply for an Apartment After I Get Denied Due To Bad Credit?

A: Yes, you can. A rental denial usually doesn’t appear on your credit report, so it’s possible. However, the approval chances depend on the reason for denial. If the reason was low credit scores and you have worked to improve them, then you can apply after you reach the ideal FICO range, i.e., 630 and above. However, if the reason is a previous bankruptcy or criminal record then you may not be able to reapply.

Q: Can CoolCredit Really Help Raise My Credit Scores For Free?

A: Yes. It is an AI-assisted app equipped with the following capabilities:

• Credit monitoring 
• AI-powered credit report analysis
• DIY tips to deal with the negative items on your credit report
• Step-by-step instructions on raising a dispute (if/as needed)
• Ready-to-use dispute letter templates
• Expert assistance from a credit expert (if/as needed)

Hence, you can start working on improving your scores from today itself for better chances of getting an apartment, even if your credit score may not be excellent right now.