When rent­ing your first place, good credit can open doors

South Florida Times - - BUSINESS - FORT LAUDERDALE, Fla.With the ad­vent of the Buy Black and Bank Black move­ments, we need a strong By NerdWal­let


When first-time renter An­gel­ica Fattu-Lo­gan, 20, started ap­ply­ing for apart­ments, she braced for re­jec­tion. But those re­jec­tions never came _ in part be­cause she had good credit.

“I ap­plied to about three or four dif­fer­ent apart­ments, and they all ac­cepted me right away,'' says Fat­tuLo­gan, a drug­store man­ager and col­lege stu­dent from Peo­ria, Ari­zona, who re­cently moved into an apart­ment with her fi­ancee. “It was a pretty quick process, like two days. It was just a mat­ter of pick­ing which one I liked bet­ter.'' She main­tains her credit by pay­ing for gro- ceries with her credit card and pay­ing off the bal­ance right away. For young folks fear­ing re­jec­tion from land­lords, Fat­tuLo­gan's pos­i­tive ex­pe­ri­ence is heart­en­ing. It also il­lus­trates an im­por­tant point: Good credit can be es­pe­cially help­ful for first-time renters.


When you're new to rent­ing, good credit can make up for other short­com­ings in an ap­pli­ca­tion.

“If (ap­pli­cants) have a good credit score, even if they haven't rented be­fore, that means that they've han­dled their fi­nances well and that they're re­spon­si­ble,'' says Laura Agadoni, a land­lord and real es­tate writer based in Marietta, Ge­or­gia. That could be enough to make up for a lack of a rental his­tory, oth­er­wise a ma­jor fac­tor in rental de­ci­sions, she says.

“My bot­tom line is, I just want to get my rent on time,'' she says.

Re­quire­ments can vary, but Agadoni says many land­lords look for credit scores of 640 or higher for renters. They also con­sider fac­tors such as in­come, debt and em­ploy­ment.

In some cases, those with good credit scores might not need to find a co-signer, a per­son _ of­ten a par­ent _ who's equally re­spon­si­ble for mak­ing pay­ments. But Agadoni notes that she might still re­quire a first-time renter with good credit to get a co-signer if they've worked at their job for less than a year and have lim­ited savings, for ex­am­ple.

“Every sit­u­a­tion is dif­fer­ent,'' she says.


If you're ap­proved with good credit and meet all the land­lord's re­quire­ments, you'll gen­er­ally just have to pay the se­cu­rity de­posit and rent de­scribed in the rental list­ing. But if you're ap­proved with bad credit, you may have to pay a pre­mium _ not just on rent, but po­ten­tially for util­i­ties, too.

“We've def­i­nitely seen con­sumers with more chal­lenged credit hav­ing to put higher de­posits down in or­der to rent a prop­erty,'' says Jim Triggs, se­nior vice president of coun­sel­ing at Money Man­age­ment In­ter­na­tional , a non­profit credit coun­sel­ing agency. The firm of­fers coun­sel­ing to renters, among other ser­vices. He adds that land­lords sometimes also charge higher rents to these ap­pli­cants.

Many util­ity com­pa­nies _ such as elec­tric­ity and gas providers _ also charge up­front de­posits to those with poor credit.

“Nor­mally, the bet­ter your credit, the bet­ter ar­range­ments you'll have with any of those util­ity com­pa­nies, up to and in­clud­ing zero de­posits,'' Triggs says.


In cities where the rental mar­ket is ex­tremely com­pet­i­tive _ say, San Fran­cisco or New York _ hav­ing good credit is just ta­ble stakes. But in areas where land­lords have trou­ble find­ing ten­ants, a good score can give you bar­gain­ing power.

That's be­cause good credit is a crys­tal ball that tells land­lords you're re­li­able. “How you pay your bills is pre­dic­tive of how you're go­ing to pay your bills in the fu­ture,'' says credit ex­pert John Ulzheimer . “That in­cludes rent.''

If a land­lord is ea­ger to find a renter and you have good credit,“the apart­ment (land­lord) is ab­so­lutely go­ing to want you to move in, and move in lick­ety-split, be­cause they're go­ing to want to start get­ting paid,'' Ulzheimer says. “And you can lean on them a lit­tle bit.''

For ex­am­ple, he says, you may be able to ne­go­ti­ate a good park­ing spot or ex­tra garage re­mote con­trols, even as a first-time renter.


Be­fore you go apart­men­thunt­ing, check your credit re­ports and credit scores to see where you stand.

Do­ing so is free and doesn't hurt your scores. If you have good credit, you can walk into prop­erty view­ings with con­fi­dence, know­ing you're set up for suc­cess. If you have bad or no credit, you can fo­cus on mak­ing im­prove­ments.

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