Through April 20, 2022, Experian, TransUnion and Equifax will offer all U.S. consumers free weekly credit reports through AnnualCreditReport.com to help you protect your financial health during the sudden and unprecedented hardship caused by COVID-19.
In this article:
There is no standard credit score to rent an apartment. The score you'll need will vary depending on your city and neighborhood and the policy of the apartment's landlord or property manager.
According to an analysis of more than 5 million rental applications by apartment industry blog RENTCafé, the average U.S. renter's credit score was 638 in 2020—an average score that has ticked up by one point in each of the past three years.
Having a good credit score can play an important role in getting your rental application approved. Read on to learn more about getting your credit apartment-ready.
What Do Landlords Look for on Your Credit Report?
Landlords check your credit for many of the same reasons lenders do: They want to know if you're likely to pay your bill on time, based on your past history of paying off debt.
In addition to pulling your credit score, landlords may also check your credit report for evictions, bankruptcies, accounts in collections, loan defaults and late payments. Before submitting any rental applications, you'll want to check your credit report and score. You can do this for free at AnnualCreditReport.com; you can also access your Experian credit report and credit score directly through Experian. Looking over your reports and scores will tell you where exactly your credit stands, and will provide clues to what you'll need to do to increase your scores.
In addition to your credit, landlords may use other types of reports and background checks to screen you as a potential tenant. Tenant screening may also include criminal background checks, a review of your employment history or contacting references. If a landlord has reported your payment history to a credit reporting agency like Experian's RentBureau, you may have a renter's credit score that shows whether you've paid your rent on time.
Renters in competitive cities like San Francisco, Boston and New York have average credit scores above 700, according to RENTCafé, so you might need to set your sights a little higher if you want to live there.
Tips for Getting Approved When You Have Bad Credit
A high credit score can be a point in your favor when you're applying to rent an apartment or house. If your credit score could use some help, take steps to improve it. Alternatively, you could look for ways to work around it. One idea is to seek out landlords who don't check credit—or whose credit scoring standards might be in line with your score. Hoping to find a landlord who's simpatico? Ask what their requirements are before you submit an application.
Changing your environment might help as well. RENTCafé found that average credit scores varied significantly from one major city to another, and between large cities and surrounding areas. There was also a significant spread between luxury apartments and affordable housing. Renters in high-priced buildings had average credit scores of 669, compared with 626 in mid-range buildings and 597 for low-cost apartments. If your sights are set on a high-end rental, choosing a more modest option could help improve your eligibility.
Your credit score isn't the only thing landlords will consider when reviewing your rental application. Try making yourself a more appealing candidate with these tips:
- Highlight your income. Demonstrating that you earn at least three to four times your rent on a steady basis goes a long way toward qualifying you for a rental even if your credit scores are low. If your income doesn't make you a stellar candidate at one place, look for another place with lower rent.
- Pay more upfront. You may be required to pay one to three months' worth of rent upfront as a security deposit if your credit is poor. You can also offer a few months' rent proactively as a gesture of good faith.
- Make your case. Maybe you have a story your landlord should hear: You've taken steps to overcome past finastrongcial setbacks or have a new career after completing your education. Writing a quick letter of explanation to add to your credit application might make a difference. Also think about whether your current landlord or employer would write you a letter of reference.
- Look for a roommate. Adding a roommate to your lease or rental agreement can increase your creditworthiness and your qualifying income.
- Find a cosigner. A cosigner with a good credit score can also bolster your case, but be cautious about exercising this option. If you default on your rent, your cosigner will also be on the hook.
Consider Improving Your Credit Before Applying
If credit issues are consistently preventing you from getting the apartment you want, think about pausing your apartment search and taking time to improve your credit. Of course, this strategy only works if you're in a position to postpone your move. But if you can wait—and work on your credit—you may improve your prospects. Several months or a year of making on-time payments, paying off late accounts and paying down debt can help to raise your credit score. And putting more time between any negative events like collections or bankruptcies and your rental application might help your application look more promising.
You might also want to take a look at Experian Boost™† . The free service from Experian connects to your bank account and adds bills such as utility, cellphone and streaming service payments to your credit report so they can be factored into your scores. The average Boost user who sees an increase improves their credit score by 12 points.
The credit score you need to secure a rental will vary; the higher your credit score and the cleaner your credit report, the better. You may be able to work around credit issues by finding a landlord who doesn't check credit, choosing a more modest place to live, or emphasizing financial strengths like a high income or large upfront payment.
In any case, if you're contemplating a move, don't wait to check your credit score and report. Going over your credit means you'll know what landlords see when they review your application. It can also help you know what steps to take to improve your credit—by paying down credit card balances, for instance. If you decide to postpone moving to work on your credit, check out free credit monitoring: You'll be able to keep an eye on your credit and celebrate your progress as it improves.