Apartments are available to renters with bad credit, but landlords often require alternative evidence that potential tenants are reliable and have strong, stable income sources, U.S. News & World Report states. For example, landlords may only choose to house low-credit tenants who have a cosigner or guarantor with acceptable credit.
Sudden financial setbacks, such as unemployment or medical bills, may contribute to low credit scores, so individuals must demonstrate that their credit issues aren't automatically signs of poor money management, Forbes notes. If financially possible, an effective option is to offer a higher security deposit or several months of rent in advance. Since landlords are most concerned about a renter's ability to make consistent payments, giving landlords more money upfront reduces their financial risk. Offering to pay monthly rent through a direct deposit system may also give landlords assurance that potential renters are confident in their income sources.
Approaching independent landlords instead of rental companies is advised because management firms often have minimum criteria they aren't allowed to compromise on, recommends U.S. News & World Report. Renters should also be straightforward when addressing credit issues and strengthen their applications by including an up-to-date credit report and a brief note explaining any major contributing factors, such as student loan debt. At the same time, renters should show their ability to pay by giving landlords access to an income statement and providing recommendations from previous landlords or employers. An income statement may help renters prove their earnings sufficiently exceed their total debt.