Poor Credit

Tips to Help Renters With Poor Credit Scores

By Andres Soto

You’ve heard it from your friends and family, renting a home in New York City can be a nightmare. To make sure you have a positive experience it’s imperative to be prepared with certain documents. Typically, landlords will want to see your letter of employment, pay stubs, tax returns and bank statements. You have all that? Great!

In a competitive rental market, like Long Island City’s rental market, having great credit can keep you ahead of the race. However, what if you don’t have great or good credit? Does this mean you have a zero chance to land the home you want? No it doesn’t. It just means you have to work a bit harder than every other applicant.

There are several different reasons why applicants have a poor or less than perfect credit scores. Most real estate agents and landlords agree that there is more to qualifying you for a rental unit than just looking at your credit score. 

Here are 8 tips that could help you out during the process.

1. Be aware of your credit score. The worse part when looking for a home is finding one you fall in love with and later find out that your credit score is in bad shape! The fact that your credit score is one of the many items considered in the rental decision should be reason enough for you to have your credit report pulled up ahead of time. This could also help you check for inaccuracies that need to be fixed. Go to Freecreditscore.com and sign up for a free review. You do have to enter your credit card number but simply cancel your account before their allotted time has expired so you aren't charged. 

2. Be honest about it. Nearly all buildings in Long Island City, and New York City for that matter, will require a credit check. Don’t waste anyone’s time. It’s better to be upfront about your credit score no matter how embarrassed you are about it. By disclosing your credit with your broker they’ll be better prepared to help you. Your broker should be able to recommend you to landlords and/or buildings that don’t have very strict rental guidelines and to buildings that they have a better business relationship with.

3. Be open to having a guarantor. This is where having great connections becomes very handy. If you have family or friends who earn more than you do and have a better credit score you could ask them if they would be willing to be your guarantor. Note, there are risks when taking this route. One risk can include an unnecessary set of new requirements such as your guarantor disclosing their private financial information to the landlord. Another risk could be jeopardizing the relationship you have between yourself and the guarantor, especially if you are behind on paying the rent.

4. Lookout for smaller buildings. One of the many benefits you’ll have by living in a hi-rise building is the amazing amenities you can use and the multiple options of apartment layouts available. Though, these buildings will always have a strong list of approval requirements and there’s always a high demand of interest. If you don’t fit the buildings qualifications they’ll easily move to another applicant on their queue. If you keep an eye out for smaller buildings or 2-4 family residences who have actual human landlords you may be surprised that these landlords care a bit more about the applicant's personality and ethics than just their financial statements.

5. Get your reference letters prepared. If you had a positive experience with your previous landlord, having then back you up is a great way for a future landlord to consider you as a tenant. In fact, you could go ahead and get personal reference letters from employers and friends as well. Landlords may consider using the positive feedback written in those letters when making their decision. Hey, every little bit counts!

6. Be ready to downgrade. Just because you can afford it does not mean you should go after it. A typical applicant will usually try to rent as much apartment as they could possible afford. Sometimes it’s better to adjust your living parameters a bit and choose a place that’s less expensive. This way, you’ll have more “per month savings” and show more favorable on your income/expense ratio.

7. Be ready to show some cash. Think Jerry Maguire screaming “Show me the Money”!  If you ask, one of the most direct ways to have some landlords overlook your credit score is by showing them your cash at hand now. Offering a large up front rental payment than what’s typically required is a great way to land the home you want. With cold hard cash in the landlord’s hand and you may be able to beat out any possible competition.

8. Be open for subleasing. There are many websites out on the web, where you can find people who can rent an apartment with you. This way, you have somebody to share the expenses with and not have to rely on your own credentials and budget to get qualified. Of course, this step has its own risks.

I hope these 8 tips have helped you think of different ways you can qualify for a rental unit if you have a poor credit score. Did you take another route to rent a home in Long Island City? Share your tips with us.

Bonus tip/ shameless plug:  If you’d like any assistance in finding a home please feel free to reach out to me at asoto@corenyc.com .