If you have a bad credit or no credit, finding a place to live can be difficult. Here's how to find apartment to rent without a good credit history.
When it comes to renting an apartment, your credit score matters. In fact, according to a report by TransUnion, nearly half of all landlords use credit checks to decide whether or not to lease to a potential tenant.
If you’ve never rented before, or if you have a bad credit score that you’re working on repairing, this can make finding a place to live very difficult.
The good news is that it's not impossible. Here are a few ways you can find apartment to rent without having a credit history.
Have someone with good credit cosign for you.
If you're a first-time renter, you can ask a parent, other family member or close friend to cosign for you. If you go this route, you must act responsibly by paying your rent on time and being a respectful tenant. If you don’t pay your rent, or if you cause damage to the apartment and can't pay, your cosigner will be responsible for total payments due. Make sure you and your cosigner keep the lines of communication open.
Rent directly from a property owner.
Most large management companies and apartment complexes require a full credit check before they’ll allow you to rent an apartment. But independent property owners might have more flexibility. They may let you prove that you have the means to pay the rent each month by providing pay stubs, bank statements, or other financial documents.
Ask your friends, family, and coworkers if they know anyone personally who's looking to rent out a unit. Make the most of your connections to find a landlord who will work with you – just make sure to sign an official lease before moving in, and don't pay anything to the landlord until you've seen the unit and signed a lease.
Offer to pay more upfront.
Usually before moving in you'll need to pay a standard security deposit, and sometimes the first and last months’ rent as well. However, a landlord might be more inclined to rent to you if you can put three or more months rent down in advance. This tells the person you’re leasing from that you have the ability to pay for the apartment and are responsible, and it minimizes the risk they're taking.
Sign a short or month-to-month lease.
A landlord may be more willing to take a chance on someone without much credit history if the commitment is for a trial basis with a month-to-month or otherwise short lease. It’s less risky for the landlord, and it allows you enough time to prove that you’re a good choice as a tenant. The downside is that you may have to pay a bit more, as often a higher monthly rent is the tradeoff in case you don’t work out and the rental agent or landlord has to fill the vacancy sooner than expected. Also, plan on being prompt or even early with your rent payments – after all, this is like a probationary period, and you want to demonstrate responsible fiscal behavior.
Explain your situation.
Credit scores don’t always tell the full story. You may have valid reasons for having bad or no history, for example, if you've faced an unexpected medical debt. Along with the rental application, include a letter explaining your circumstances. If you can talk directly to the property manager or owner, even better.
Still, your charm and personality alone will probably not convince a stranger to rent to you. So, be ready with reference letters from employers or others who can testify to your character and positive financial habits.
While the best way to get approved for an apartment rental is to provide a solid credit history, we all have to start (or get back on track) somewhere. And once you do rent an apartment, keep in mind that you can build your credit by having your rent payments reported to credit bureaus.