Bad Credit
How to Get an Apartment With Bad Credit
How to Rent an Apartment Without a Credit Check
Are you looking to rent your first apartment? Finding your first apartment can be a thrilling experience, but it isn’t quite as fun if you rent an apartment when you have bad credit.
It is still possible to get rent an apartment if you don’t have the best financial history. What many renters end up doing that have run into financial problems is to look for an apartment with no credit check. Finding a no-credit-check apartment, however, is not as easy as it sounds.
You are probably going to temper your expectations of the apartment you’ll end up renting. Finding your dream apartment will probably have to wait, at least for now.
Let’s look at what you can do to be approved by a landlord when you don’t have the best credit scores. By the time you are done reading, you’ll know how to get an apartment when you have bad credit or no credit.
Renting a No Credit Check Apartment Without Rental History
Landlords like to see that you have a history of renting. It gives them confidence that you will be a good tenant for them. References from your previous landlords will show them that you were a good tenant and are less likely to cause problems in the future. It is similar to a home seller wanting to know a buyer is preapproved to get a mortgage for a home purchase.
If you haven’t rented before, references can still help get the apartment that you want. Character references from a source that the landlord can trust, like an employer or a teacher, should show that you will be a dependable tenant.
Alternatively, you could begin to build a rental history by renting a room from a friend or family member. You can then get a reference from them when you find an apartment.
This can also go some way to help if you have a bad credit history. Make sure you get receipts for your rental payments, so you can show a landlord that you pay your rent. This can counter a less than perfect credit history and help a landlord be more interested in having you as their tenant.
Highlighting Your Salary
If you have a decent income, even without great credit, it can impress the landlord. If you can prove an income that is 30 or 40 times the rent, the landlord may be happy to overlook a poor credit score.
If this is an option for you, the landlord will need to see clear proof of your salary. You should have pay stubs going back a year, if possible. Do everything to make it easy to confirm your income for the landlord.
Getting a no credit check apartment can be a lot easier when you explain your poor credit history upfront but prove to them you’ve got excellent income to support the rent payments.
Being upfront and honest will go a long way with many property owners.
Set Aside Savings to Show The Landlord
Another option when renting with bad credit is to have savings to cover a few months’ rent. If you can show the landlord your bank statements with enough money to pay the rent for many months, they will be more likely to overlook other problems.
With savings set aside to pay the rent, you will be less of a risk to the landlord. It could be enough to overcome a lack of rental history or good credit.
Automatic Rent Payments May Help
If you can set up autopay for rent, it can make the landlord more confident about having you as their tenant. This will mean that the money will be taken out of your account each month, without you needing to do anything.
While you do need to make sure you have enough money in your account each month, this can help in combination with other factors to get the apartment you want.
Honesty is the Best Policy
As already mentioned, if you want to rent a no credit check apartment, you need to be honest with the landlord. Even if you don’t meet the requirements the landlord is looking for; you might be able to win them around and get them to make an exception.
Write a letter to the landlord explaining why you don’t have good credit.
If the apartment is owned by an individual landlord rather than a management company, you will stand a better chance. An individual landlord has more discretion to change their requirements if they like what you have to say.
If you have worked on the past problems with better budgeting plans and more responsible behavior, let them know.
Paying More Rent Up Front
When you are renting an apartment with bad credit, you can make the landlord’s decision easier by offering to pay more upfront. Typically, when renting an apartment, you will need to provide a security deposit, and if you have bad credit, you could offer to pay more. This reduces the landlord’s risk and could change their mind if you don’t otherwise meet all their requirements.
For example, you could offer the pay the first three to four months of rent in advance. Many landlords will appreciate how hard you are willing to make this work. From their perspective, it offers some additional peace of mind and also provides them with an influx of cash.
Get Help From a Co-Signer
As a last resort, you may want to get a co-signer when trying to rent an apartment with bad credit. If none of the other options will work, a co-signer may allow you to rent an apartment with bad credit.
It would be best if you had someone with good credit to agree to guarantee to the landlord that the rent will be paid each month. If you don’t pay, it will be the responsibility of the co-signer.
Final Thoughts on Renting With Bad Credit
Finding a landlord who will rent their apartment or home to you when you have bad credit will not be easy. You can expect to be turned down in a few places before you finally land a rental. By following the rental guidance here, you should be able to increase your odds of being successful.
Best of luck!
When you are in need of money quickly, you very likely don’t want to sit around pondering a bunch of different options. You want to find the option that works best for you and utilise it. Unfortunately for so many people around the country, it can be difficult to get their hands on the money they need due to them having a bad credit score, or even no credit score at all.
Photo, Varun Gaba.
Your credit score is thought of as being pretty important, as it shows your financial trustworthiness to financial institutions like banks, credit card companies, lenders, and more. Your credit score is one thing that will usually be considered by just about any company you apply for a loan through, so keeping a close eye on your credit score is imperative for your financial life.
No matter what your credit score looks like, knowing how you can prequalify for a personal loan can be a comforting feeling when you are in need of quick cash. After all, when you are eligible for personal loan prequalification, you feel a little better going into the loan process knowing you won’t have to wait around for a loan decision.
How is Pre-qualification Decided? Prequalifying for a personal loan can depend on several different factors that you will have to keep in mind, and it will vary greatly depending on the lender you are applying through. Here are two of the things you will need to keep in mind when it comes to your loan that could affect whether or not you prequalify for the loan.
— Your credit score; Yes, this is always going to be something you are going to need to think about. Depending on the financial institution or lender you are going through, you can bet that your credit history and score will play a huge part in whether or not you prequalify.
— The amount of your loan; How much money you plan on borrowing from the lender or bank is also going to play a part in deciding whether or not you prequalify.
To get the most out of your search for a lender that you could prequalify with, think about applying with more than just one lender. This way, you might get several pre-qualification offers, and this will allow you to sort through the lenders and decide which one works best for you.
Photo, Christina @ wocintechchat.com.
The Pre-qualification Process: No matter where you are trying to prequalify for your loan through, you will find the process to be pretty simple and largely similar across most lending platforms. You will need to provide some information to the lender that will help them decide whether or not to prequalify you.
Photo, Windows.
Some of the information you will need to provide includes:
— Your full name; You will want to make sure you provide your full legal name so you can make the process simple for yourself and the lender. Depending on the lender, you might also be asked to provide images of your government issued ID or driver’s license to validate your identity.
— Your income and information on your job; Your income and employment status are often considered over your credit score when it comes to pre-qualification for loans, especially if you are applying for a personal loan through a lender who deals with customers with bad credit or no credit.
— The loan amount you want; Of course, you will have to include the amount of money you would like to borrow. Make sure it is something reasonable, and something that you can realistically pay back on time.
What Will the Lender Do? If you are trying to prequalify through a lender who specialises in bad credit clients, then you won’t have to worry about your credit score being negatively affected by taking out your loan. However, if the lender reports to the credit bureaus, your payments could still make an impact on your credit score.
If not working with a specialised lender, you might find that the lender will do a soft inquiry on your credit when going through the pre-qualification process. No worries here, as this doesn’t put any dents in your score. If you prequalify for the loan you are looking for, you should get an alert via email from the lender of your choice.
The Money You Need: Hopefully, you will have prequalified for the loan you are looking for so you can ensure you have access to the money you need, when you need it. Whether you’re going through some unexpected circumstance in life or just need money to pay something off quickly, knowing you are prequalified for the loan you need is a comforting feeling, allowing you access to the cash you need for whatever you need it for.
Qualifying for a zero-down car deal likely means having good credit and qualifying income. However, if you’re a bad credit borrower, you’d be hard-pressed to qualify for an auto loan without a down payment. Besides – down payments are typically a great idea for borrowers across all credit ranges!
Is Zero Down a Bad Idea?
Opting for a zero-down car loan isn’t a bad thing – but with a lower credit score, it’s not likely to happen. Most bad credit auto lenders require at least $1,000 down or that you bring at least 10% of the vehicle’s selling price to the table. Down payments are a requirement of most subprime (bad credit) lenders, and it’s often called having “skin in the game.”
Research shows that borrowers with skin in the game are more likely to complete a car loan. To a lender, a borrower that brings a down payment to a deal is more likely to make their payments, complete the loan, and avoid default. It also means a higher likelihood of qualifying for the auto loan.
Down payments can widen your vehicle choices since they allow you to get into more expensive cars that are outside your preapproval amount. If you’re approved for a $15,000 auto loan, but can’t find anything for your situation, adding a larger down payment amount may open up more vehicle choices. In this scenario, if you have your heart set on an $18,000 vehicle, coming in with a $3,000 down payment could put it in your price range.
More Down Payment Benefits
Auto loans are typically simple interest loans, meaning you’re charged interest on the principal of your loan. If you combine a large loan amount, a high interest rate, and a long term, it can mean paying more than your vehicle is worth.
Remember this:
High loan amount + High interest rate + Long loan term = Paying more interest charges. A down payment can combat this, and help save you money.
For borrowers with poor credit, a high interest rate could mean paying more for your auto loan – but a down payment can soften the blow.
Down payments can help protect you from negative equity, too. Negative equity is when you owe more on the auto loan than what the car is valued at. Vehicles are depreciating assets, meaning they lose value over time, and that never stops.
Negative equity causes problems for borrowers when it’s time to sell the vehicle. If you owe thousands more on the loan than what you can sell the car for, you may not be able to sell the car. You must pay off the loan before you can transfer vehicle ownership.
If you finance a vehicle for $10,000, that car may not be worth $10,000 in a year. Most used vehicles lose around 10% to 15% of their value each year. Brand new vehicles can see around a 20% drop in value within the first 12 months of ownership! Having a down payment can help keep your auto loan in an equity position, which means you’re likely to have fewer issues selling the car if you need to.
How Much Should Save for a Down Payment?
Your down payment requirement largely depends on your credit score and the size of the loan you’re applying for. Like we mentioned, saving at least $1,000 is probably a good starting point if your credit score is less than perfect. But if the vehicle you want is expensive, it could mean having to shell out more cash than that to qualify for the loan.
How much you need to save can also depend on your monthly budget. If you want a specific vehicle but the monthly payments are too high, you can put more cash down to lower your payment and make the loan work for your situation. You can use our auto loan calculator to estimate how much you may need to put down to get your car payment where you want.
You also don’t need cold, hard cash to meet a down payment requirement. Trade-ins with equity can completely satisfy a down payment requirement if there’s enough value, or you can use a combination of cash and your trade-in. If you have a car you’d like to trade in, research its estimated value on sites such as NADAguides and Kelley Blue Book so you can see what a dealer may offer.
The bottom line with down payments is you should save as much as you comfortably can afford. Even if you qualify for a zero-down car loan, putting cash down on your next auto loan is only going to bring you benefits in the long run.
Where Can I Find Bad Credit Car Loans?
If your income or credit score isn’t quite up to snuff, then you can expect to need some cash down to qualify for vehicle financing. You may also need to work with the right auto lender to get the vehicle financing you need.
With a lower credit score, not only are you faced with a down payment requirement but also the struggle of having to find an auto lender that can work with poor credit. Most traditional auto lenders prefer borrowers with good credit. If your credit score is rough around the edges, then applying for vehicle financing through a special finance dealership could be the way to go.
Special finance dealerships are signed up with subprime lenders. These lenders specialize in assisting borrowers with credit challenges and look at more than your credit reports and score. They do require a down payment, but they can often work around tough credit circumstances.
At Auto Credit Express, we’ve amassed a nationwide network of special finance dealerships and we want to help you find one in your local area. To get matched to a dealer near you that has bad credit lending options, fill out our free auto loan request form.
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