Renting a home is a long process and landlords have a lot of different conditions before they give you the place. One of the most common demands is to ask for a background check on the renter, which includes a credit check. If you feel uneasy about the credit check, here are some things you need to know.
What Do Landlords Look Out For?
Most landlords look at certain things while making the decision the leasing. While doing credit checks, they may look for:
- Loans (current and past)
- Bankruptcies, foreclosures, and short sales
- Minimum payment amounts for debt accounts
- Late payment histories
- Credit histories
- Credit scores
Why Do Landlords Do Credit Checks?
This is a security measure that most landlords take. They need to make sure that you have stable finances or else you may not pay rent on time. The credit history can assure them whether you will create trouble for them in terms of paying rent. It gives them an indication of how you would be as a renter.
Prior evictions, debt amounts, late payments, and other credit mishaps can indicate whether you will pay rent on time every month. Rental history can also show them if you had trouble making payments to the previous renter. This can also indicate whether you still owe the previous renter any money. Credit checks also highlight bankruptcy status. If you are bankrupt, you will definitely have trouble paying rent each month. If you have any loans on your name, they can also evaluate if you will be able to pay all your bills based on your income.
How Does Your Score Affect Renting?
Credit checks are one of the most important factors that landlords take into account while leasing their home to someone. A minimum of 600 to 620 will probably get you the house, but some landlords may still create trouble at this. A lot of property owners consider car repossessions, accounts under collection, and credit card charge-offs as deal breakers. They may also look at your criminal history, eviction history, and income to make the decision.
What Can You Do?
Most banks refuse to give out loans to buy a house if you have such a score. The only option left is renting, but that too can become really hard if landlords create trouble. It is important to get your credit score in order before you rent a house. There are many financial advisors that can guide you on how to repair your credit score to ease the issue. While dealing with housing, it can be really hard if you have a bad credit score.
Venture Credit Solutions has a team of expert credit advisors that can help you out in such situations. They have expert advice on how to fix your credit score. They guide you on how to manage your finances to repair the damage to your credit score. This can surely help you if you are planning to rent a house.