Listen up renters with bad credit, here's what you need to know.
Bad credit can haunt you. A bad credit report can make some tasks difficult, from renting an apartment to buying a car to taking out a loan. As many landlords now rely on a credit check to vet potential renters, it becomes ever more essential to have a perfect credit score. As a first-time renter or a renter with bad credit, you may struggle to find a place that accepts your less-than-ideal score. However, renters with bad credit can boost their scores! Here's how.
Find a guarantor. This is simultaneously the easiest and long-winded approach. Ask a parent, trusted friend, or relative with good credit to co-sign the rental application with you. This provides the landlord extra reassurance that someone with a good credit history is helping you out. However, it may be easier said than done to sweet-talk a relative into being responsible for you. Make sure that the monthly rent is an amount that you can afford so that you won't put him or her into a tricky financial position.
Pay rent in advance or increase the security deposit. Bad credit makes landlords nervous because it indicates that you've defaulted on your previous bills or had little to no history of paying bills. Be prepared to pay a month or more in advance or a heftier security deposit. This provides the landlord with extra cash that can cover some of the losses and damages should you skip out on rent.
Get a roommate. If you're willing to share the core rooms (living, kitchen, and bathroom) with a buddy, you might be in a better position to rent. If the landlord only allows one person on the lease, ask if your roommate is willing to sign it solo. This way, the person on the lease is the one with the better credit score.
Show proof of income. The best way to assuage landlord concerns about credit is to provide them proof of your regular and consistent income. When applying for an apartment with bad credit, have recent pay stubs, tax returns, and a letter of employment on hand!
Work to perfect your score. Bettering your credit score takes time, patience, and organization. Aim to always pay credit card bills on time, respond to collection agency phone calls immediately, and don't close an account that's in good standing. Bettering your credit score over time will eventually help you to apply for that next apartment or home loan!To make the most of your finances, work to protect them.
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