When you apply for an apartment, your potential landlord or property manager may check your credit. Most want to know that you have a good credit history before working with you.

That said, there are ways to rent an apartment without good credit, such as using a co-signer or renting with a qualified roommate.

Here’s everything you need to know about the relationship between renting and credit to determine the best approach for you.

What Credit Score Do You Need To Rent an Apartment?

There’s no universal minimum credit score to rent an apartment. Expectations vary between landlords, just like they do between creditors. That said, the average credit score among renters was 638 in 2020.

However, you should aim to have good credit, which generally starts at a score of 670. You can be reasonably confident that your credit will be sufficient to rent most apartments.

Fortunately, you can also qualify for some apartments with a bad credit score or limited credit history. Not all landlords initiate credit checks when you apply, and you can earn some flexibility by demonstrating strength in other areas of your rental application.

For example, some landlords may be willing to accept a lower credit score in exchange for a higher security deposit. If you have enough cash to put down an extra month or two upfront, you’ll have an easier time renting.

Learn More: Credit Score Statistics

Why Is a Credit Score Needed To Rent an Apartment?

Your credit score is a representation of how likely you are to repay your debts based on your credit history. It’s primarily an underwriting tool for creditors but is also a convenient metric for prospective tenant screening.

After all, your monthly rent payment is a fixed obligation, just like debt. Rental history doesn’t factor into your score, but it makes sense for landlords to prefer tenants with a track record of making similar payments on time.

It may not guarantee that you’ll be a responsible renter, but a higher credit score indicates that you’re likely to abide by your agreements and cause minimal issues during your lease.

Conversely, landlords may be wise to stay away from people who haven’t always kept up with their debts. Even if they’re trustworthy individuals, they may be under financial stress that prevents them from paying on time.

Late-paying tenants can cause cash flow issues for landlords and put them behind on their own financial obligations, such as the mortgage and taxes for the property. They can even force the landlord to evict, which is an expensive and tedious process.

What To Do if You Have a Low Credit Score

A low credit score can make it significantly more difficult to rent an apartment, but it rarely makes it impossible. Let’s further explore some ways you can get around the issue.

Offer To Pay a Higher Security Deposit

A security deposit is a refundable down payment for a rental that gives landlords some assurance. Not only can they use it to cover any damages or unpaid costs upon move out, but it also demonstrates your financial stability.

As a result, offering to pay a higher security deposit can help you qualify for an apartment despite a bad credit score. It reduces the landlord’s risk and should inspire greater confidence in you.

For context, security deposits often range from a few hundred dollars to the first and last month’s rent. Just make sure not to agree to anything you can’t afford.

Provide References

A poor credit score indicates that you’ve failed to manage your credit effectively in the past. However, it doesn’t give much context regarding why. There may have been extenuating circumstances, or it could’ve been due to personal failings.

Providing multiple references can help you make a case for the former and argue that you’re responsible. If you can convince your prospective landlord, they may be more confident in your willingness and ability to pay them back.

The best references you can provide typically come from a previous landlord, but you should usually also offer work and personal ones as well.

Explain Your Situation

There are no guarantees, but renting an apartment with a bad credit score may be as simple as pleading your case. If you know your credit score is a red flag, be proactive. Put together an argument and explain why your landlord should overlook it.

Remember, they want a tenant that will pay them back, so find a way to convince them despite your bad credit. Consider explaining what caused your score to drop and how your situation has changed.

This strategy is often more effective with an individual landlord rather than a property manager at an apartment complex. As the property owner, they have the authority to be more flexible.

Use a Co-Signer

A co-signer agrees to take responsibility for your monthly rental payment if you fail to pay. If the co-signer doesn’t pick up the slack, the landlord can pursue both parties to recover any losses.

Notably, co-signers should have a good credit score and reliable income. That significantly lowers the risk for your landlord and is often enough to convince them to rent to you, though not all of them accept co-signers.

Of course, you can’t just get anyone to be your co-signer since it involves taking on significant financial risk. The strategy is often most readily available for younger renters whose parents are willing to provide a safety net.

Find a Roommate With Good Credit

Applying for an apartment with a creditworthy roommate is similar to getting a qualified co-signer. However, in addition to sharing your responsibility for the lease, it also reduces the earnings you need to be eligible.

Landlords often want a potential tenant to make three times the rent in gross monthly income. Splitting $2,000 in rent with someone else may mean that you only need to make $3,000 rather than $6,000.

Once again, this strategy is somewhat reliant on your personal network. However, you may be able to find a creditworthy roommate outside of your immediate circle through referrals or online platforms. Just do your due diligence. 

Find Someone Who Doesn’t Run a Credit Check

Last but not least, you can rent from someone who doesn’t require that you undergo a credit check when you apply for their apartment. They’re more common than you think, especially among mom-and-pop landlords and lower-income housing providers.

However, use caution when renting from these individuals. Landlords or property managers proceeding without checking your credit can be a red flag as a tenant. It can indicate they’re inexperienced or even a scam artist.

How to Improve Your Credit Score

If you can’t qualify for an apartment with your current credit despite trying the workarounds above, you’ll need to improve your score. Here are some of the most impactful steps you can take.

Get a Credit Builder Loan

A secured credit card is one of the more readily available debt types and a great way to start building credit. However, you’ll need both revolving and installment debt accounts to maximize your score.

Unfortunately, installment loans are often harder to qualify for and too expensive to take out only to build credit. However, you can use a credit builder loan like CreditStrong’s to avoid both issues. 

Instead of paying out the proceeds upfront, we put them in a locked savings account during the loan. That way, we don’t even have to check your credit score. As you make monthly payments, we’ll report them to Experian, Equifax, and TransUnion.

Once you reach the end of the repayment term or decide that you’d like to cancel for any reason, we’ll release your paid-off principal balance. That way, you finish with more cash and a better credit score. Give it a try today! 

Pay Your Bills on Time

Once you have a good mix of credit accounts, the most important thing you can do to improve your credit score is to pay your debts on time every month. Your payment history is worth 35% of your score, making it the most impactful factor.

In fact, even a single missed payment can significantly reduce your credit score and stay on your credit report for seven years. Most creditors don’t report you for late payment until you’re delinquent by 30 days but don’t take that for granted.

It’s a good idea to set up autopay on your credit accounts to ensure you never miss a monthly payment by accident, especially if you have to juggle several of them.

Pay Down High Credit Card Debt Balances

After payment history, your outstanding debt amount is the most impactful credit scoring factor. It’s worth 30% of your score, making it only slightly less important than your payment history.

As a result, paying off your debts is the second most effective way to improve your credit. Since credit cards have higher interest rates than most other debts, paying them off first will save you money and reduce your balances the fastest.

If you can afford it, pay off your credit card statement balance each month. Not only will that keep your credit utilization rate low, but it’ll prevent you from incurring interest charges.

Keep the Accounts That You Already Have

The age of your credit accounts is the third most impactful credit scoring factor. However, it’s worth just 15% of your score, which is much lower than the first two. It’s worth optimizing, but don’t stress about it too much.

Generally, this aspect of your credit score will improve the older your credit accounts are. As a result, you should prioritize keeping your current ones open for as long as possible, especially your first credit card.

Dispute Incorrect Items on Your Credit Report

Last but not least, it’s a good idea to pull your credit report from each major credit bureau and verify the information in them is correct. Mistakes are more common than you might think.

In fact, one Consumer Reports study found that as many as 34% of consumers have at least one error on their credit reports. These can cause significant damage to your credit score, especially out-of-date debt balances.

Fortunately, the Fair Credit Reporting Act requires Experian, Equifax, and TransUnion to let you dispute any inaccurate details, and the process is easy to complete online.

As you implement these credit improvement strategies, you can track your progress using a site like Credit Karma. You may find that your score is good enough to rent an apartment sooner than you expected.

CreditStrong helps improve your credit and can positively impact the factors that determine 90% of your FICO score.

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