Credit Score And Securing A Rental
So you're moving out of the house; Mom and Dad have finally had enough! They helped you out for a few years while you paid down that student debt and got your feet on the ground. Now it's probably time for you to start looking at a rental property. Of course that's not the only situation for needing a rental property; you could be moving to a new city to start a job, expanding your family, moving in with your significant other, going through a break up, whatever the situation might be, at the end of the day, you need a place to live!
Now, as I am sure many of you reading this can understand that owning a house is not so simple. Renting may be your only option at this point in your life, and that's okay! But here's the thing that some of you many not realize...Your credit report single-handedly dictates your chances at securing a rental property. That's right! Gone are the days where you see an ad online, call the Landlord on the listing, set up a meeting and move in. Okay, not completely gone, but private listings aren't as easy to find nowadays. As a realtor, I work with clients renting every single day. And I will let you in on the very first question that I ask.... What is your credit score?
Your credit score is the single most important factor in the rental market. Look, I get it, you are an amazing tenant, you have great references, you are tidy and organized and take pride in your space. This may be too blunt but....who cares? Not the landlord! He/she wants to know that you make your payments on time without a fuss! Any late payments on your credit report could be the deciding factor for you to get declined, and I don't want that to be the case for you!
Nowadays, with the rental market being as CRAZY as it is...Landlords get brokerages involved in listing their properties, because it eliminates the leg-work for them interviewing potential tenants and finding the right fit for their home. At the end of the day, the landlord gets to decide who lives in their home, and they want to know their tenants will pay them on time on top of being respectful of their beloved home. So we, as realtors, pre-qualify tenants, book them showings, take them through for a private viewing and prepare all the paperwork.
What does the landlord do? He/she reviews the offer of course, but what is the FIRST thing they will look at? Your credit! What's "credit" you may ask? Well, it's your financial standings... it shows that you make payments on time whatever it may be, rent, car payments, cell phone, bills etc. Do you own a credit card? If your answer is no, then you do not have credit. Which ultimately, is the same thing as having bad credit. It may be hard for you to secure a lender when you go to buy a house someday and need a mortgage.
Your credit score varies on a spectrum, and it's important to know where you stand.
We're not asking you to put all your money on your credit card, just small enough to start building your score. Even if it's $5.00 a month! PAY IT OFF. That little amount WILL contribute to your credit score, and in turn will build your financial profile. Now I don't mean to sound harsh, but a lot of people do not know about this! And my purpose of this post is to inform the readers about how important credit is. If this blog post inspires just one person to go out and get a credit card, I will be thrilled! Just make sure, you pay it off in time every month!
We all need a place to live at the end of the day, so do yourself a favour and build your credit so when the time comes to rent another property, you will be prepared, and you will stand out to the landlord.
*Please note, this blog is not intended to solicit those home buyers or home sellers that are under a current agency agreement*