A frustrated reader keeps getting rejected when applying to rent property. Our expert tells him to improve his score — and how to land a place now with his current bad credit
Dear Credit Care,
Unfortunately, my credit has tanked, and every time I seek to rent property, the owners find that my credit score is bad. Question: Where do they find this negative credit report, and what can I do to improve that score? Thank you. — James
When you fill out applications for a rental property, know that most include wording that gives the property manager permission to check your credit report as part of the application process. So, the manager uses the personal information included on your application to pull your credit report from some or all three of the major credit bureaus — Equifax, Experian and TransUnion.
Because you know your credit has “tanked,” you likely understand what the property managers are seeing once they have a copy of your credit report. And I’m guessing that once your credit is reviewed, your application is then denied based on what was found on your credit report.
The good news is that you can definitely improve your credit, but it takes time — perhaps two years or more. However, if you are unable to maintain your current housing arrangement until you can re-establish your credit history by making debt payments on time and as agreed, you do have some options that may help you qualify to rent now.
First, be upfront with the property management team and let them know that you have bad credit before they find out from your credit report. Explain your situation (the circumstances that caused your credit to crumble), and how you have remedied the situation.
Next, if possible, get a reference from a former landlord that states the dates that you rented from him or her and your payment status. (Only do this if you paid the former landlord on time and as agreed, obviously.)
Finally, if you have someone that would be willing to co-sign a lease agreement with you, let the property management know. Keep in mind that you are putting someone else’s credit in jeopardy when you request that they co-sign for you. You should only make the request if you plan to uphold your end of the bargain.
I hope one or all of the suggestions above will help. However, if you still find that you can’t qualify for a lease, you can try to rent from an individual who may not have the same prescreening policies in place as larger apartment or condominium complexes. Or even if they do, an individual may be more willing to take a chance that you will indeed meet your obligations as a tenant, regardless of your past credit history.
I encourage you to take a look at your credit reports and determine how best to begin making improvements on your credit. You are entitled to view a free copy of the credit reports that were viewed by the landlord that denied your rental application. You are also entitled to view one free report from each of the three bureaus once a year. You can obtain your free copies at AnnualCreditReport.com.
One last thing: You may also have bureau reports in your name that include your previous rental experiences. Several rental bureaus exist. In fact, Experian acquired one of them — RentBureau — in June 2010, and is now including rental information on its credit reports. Ask the landlord if they checked your report with a rental bureau. If they did, you are also entitled to view a free copy of your report from that bureau.
Handle your credit with care!