Table of Contents
How to Get an Apartment With Bad Credit in 2024
Steps You Can Take to Raise Your Credit Score
Alternative Housing Options
Getting an Apartment With Bad Credit Bottom Line
Getting an Apartment With Bad Credit FAQs
How to Get an Apartment With Bad Credit in 2024
- Get Letters of Recommendation
- Prove Your Financial Security
- Look For Private Landlords
- Offer a Bigger Security Deposit
- Consider a Cosigner or Guarantor
- Get a Roommate
1. Get Letters of Recommendation
The first thing you should do if you want to get an apartment with bad credit is to seek letters of recommendation from anyone you have a financial association and a good relationship with. The best options are a letter from your previous landlord or bank, both of whom can vouch for your good habits now, even if your credit history indicates some past financial missteps.
Another alternative is to ask your direct supervisor at work or your professors and college advisor if you’ve recently graduated. These people are in a position to understand your personal responsibility, which can build trust with a new landlord.
Avoid references from friends and family members because they can give the impression that you don’t have more professional relationships and references to call on.
If you must use family or friends, try to select people who also have a financial relationship with you, like cosigners on a past lease.
2. Prove Your Financial Security
Another great way to rent an apartment with bad credit is to prove your financial security. Renting with bad credit but high income is a lot easier that renting with bad credit and a lower income. So if you have a high income, you should be able to get an apartment even if you have bad credit, but you'll need to provide some evidence of your financial security. Most landlords will want to see that you make at least 3 times the rent, so be ready to prove that.
Make sure you documentation handy so that you can help make the best case for you.
Documents that you can provide to prove your income include:
- Recent pay stubs
- Proof of regular rental payment at your current location
- Proof of regular utility payments
- Bank statements showing your rental history
3. Look For Private Landlords
Finding apartments that accept bad credit is tricky, but private landlords are a good option as they are often far more lenient when it comes to credit. Some private landlords may not even perform a credit check at all, and if they do, you can always explain your situation. As long as you can convince them that you can afford the apartment and will make a good tenant, most private owners will rent to you.
There are many ways to find private landlords, but plan ahead as it can take a bit more work than just searching online.
4. Offer a Bigger Security Deposit
If you have enough money saved or a high income, putting up additional money towards the security deposit is another way to rent an apartment with bad credit. By putting up a larger deposit the landlord will likely feel more comfortable and secure, and as long as you honor the lease terms, you'll get the deposit returned when you move out.
5. Consider a Cosigner or Guarantor
Another way to get an apartment with bad credit is to use a cosigner or guarantor. Having a cosigner or guarantor will help assure the landlord that the rent will be paid. Cosigners are generally people you know who may or may not have terms you have to agree to before they sign. Guarantors can also be folks you know but are generally companies that sign your lease in exchange for a monthly fee for backing you.
Either way, having an additional signature on the lease gives your landlord someone to go to in case you fail to pay your rent. Your guarantor/cosigner agrees to pay in your stead, lowering your landlord’s risk.
6. Get a Roommate
A roommate might not be your first-choice solution, but having two (or more) people on a lease can raise your chances of getting an apartment. That’s because, even if both of you have low credit scores, there is still a better chance of one or both of you paying rent regularly and on time.
When it comes to low credit, landlords just want to lower their financial liability if you fail to pay rent or are in a position where you can’t pay rent. Roommates spread out the responsibility.
Even if one of you fails to pay rent, the landlord can still probably count on a partial payment to help cover their expenses on the property until something can be done.
Steps You Can Take to Raise Your Credit Score
- Pay All Other Bills On Time
- Focus On Paying Off Debt
- Pay Your Rent On Time
The good news is that a low credit score is fixable, and every month of good financial habits helps undo the damage. The steps you’re taking now to rebuild your credit score will also show up on the financial documents you can provide to your landlord, so it’s a good idea to start these habits before you need a new apartment.
1. Pay All Other Bills On Time
Utility payments and credit card payments are just as important as rent payments when it comes to a landlord reviewing your financial history. Or, they are just as important if you fail to pay. Paying regularly helps you look better, regardless.
2. Focus On Paying Off Debt
Another factor that can impact your credit, even if you’re making regular payments, is a high debt ratio. It might not be possible to pay off a significant chunk of your student loans before getting a new apartment, but paying down a credit card or a line of credit can significantly improve your overall credit score.
3. Pay Your Rent On Time
Another step you can take is to build a history of paying your rent on time. Even if you have a bankruptcy or other issues with missed payments in the past, paying your rent consistently for six months or more can help your landlord decide that you are a good risk. While paying rent on time may not directly impact your bad credit since rent payments are generally not reported to credit bureaus, it can help show you're serious about your rent obligations.
If you also have an eviction history, landlords will take it into account before offering you a contract. But, that doesn’t mean every landlord will reject you. There are ways of renting an apartment with an eviction on your record.
Alternative Housing Options
If securing a traditional apartment with bad credit proves difficult, there are alternative housing options to consider:
1. Subletting
Subletting allows you to rent an apartment from someone who is temporarily away. This option often involves less stringent credit checks since the original tenant is still responsible for the lease. Look for sublet opportunities on rental websites or community boards.
2. Short-Term Rentals
Short-term rental services like Airbnb or Vrbo offer flexible housing solutions without the need for a long-term commitment. While typically more expensive, they provide a good stopgap while you work on improving your credit score.
3. Room Rentals
Renting a room in a shared house or apartment can be easier with bad credit. Websites like Craigslist, Roomster, and local classifieds often list room rentals. Sharing a space means sharing the financial burden, which can be appealing to landlords and current tenants.
4. Extended Stay Hotels
Extended stay hotels offer furnished rooms with amenities for longer stays. They usually don't require a credit check and provide a comfortable living environment while you search for a more permanent solution.
5. Co-Living Spaces
Co-living spaces are becoming more popular in urban areas. These communal living arrangements often include private bedrooms with shared common areas. The application process for co-living spaces can be more lenient compared to traditional rentals.
6. Living with Family or Friends
Temporarily staying with family or friends can provide a stable living situation while you work on improving your credit. This option allows you to save money, pay off debt, and build a stronger financial profile.
7. Student Housing
If you are a student or recently graduated, look into student housing options offered by your school or nearby institutions. These accommodations may have more flexible credit requirements.
8. Government Assistance Programs
Explore government-subsidized housing programs like Section 8 or public housing, which are designed to help individuals with low income and poor credit secure affordable housing.
By considering these alternative housing options, you can find a temporary or even long-term solution while you take steps to improve your credit score and financial standing.
Getting an Apartment With Bad Credit Bottom Line
Renting with bad credit can be challenging, but it's certainly possible. You'll need to prepare ahead of time and be ready to prove that you can afford the apartment and be a responsible tenant, or look for private landlords that don't run credit checks, but with a bit of leg work, you can get an apartment regardless of your credit score.
Getting an Apartment With Bad Credit FAQs
1. What Credit Score Do You Need to Rent an Apartment?
The simple truth is that you can probably find an apartment with any credit score, or even no credit, so long as you take appropriate steps to get that apartment. However, most landlords are looking for credit scores in the good to excellent range. But there are plenty of landlords who will accept fair credit, as well.
It’s only when you’re looking at a score of 580 or below, that your apartment options usually become more limited.
Good scores are generally around 670-740. Anything above 750 (on an 850-point scale) typically counts as very good or excellent, depending on the credit rating company.
The lowest scores are between 300-580. If you know your scores are in this range, it’s time to be proactive about improving your chances of getting an apartment and improving your score.
It’s also worth mentioning that you might have good or even great credit with two out of the three major credit agencies, and still have a bad rating with the third. Usually, that’s because of a mistake by the credit agency and can be corrected. That’s why checking your score regularly is important.
Unfortunately, you have no guarantee that your landlord will check more than one credit agency, which means that a bad score on one can lower your chances of getting an apartment, even if you really do have a good credit history.
2. Can You Get an Apartment with Bad Credit (500 or less)?
Yes, you can get an apartment with bad credit, even if your credit score is as low as 500, but you'll need to convince the landlord you're trustworthy and that you can pay the rent. Sometimes, you might even have to put down an additional security deposit or find a guarantor. Usually, the best way to rent an apartment with bad credit is to find a private landlord. It would be best if you planned some extra time for your apartment hunt with scores this low, but you can still rent an apartment. It will take some extra planning, though.
Start by looking for modest apartments owned by private owners or small real estate companies. These kinds of landlords often have more flexibility than big development companies and real estate firms.
It will also be best to keep your expectations in check. With a low credit score in the 500 range, you should expect to pay slightly more for an apartment. With institutional landlords, you may also have to pay more upfront or take additional steps to lower your landlord’s risk.
If you prefer to find a no credit check apartment, your best bet is to go with a private landlord.
The good news is that it can be done, and successfully paying your rent for the full term of a lease can help raise your credit score.