There are four things that apartments are evaluating on any rental application:
1) Employment and Income
2) Credit History
3) Rental History
4) Criminal Background
So that I can give you a thorough explanation, I’m going to take each of these in a separate blog post. This post is about the process Austin apartments use to check your credit history. The other topics are linked above.
Each apartment management company handles this differently, but almost every apartment or rental you consider will require you to allow them to check your credit. They do this by pulling what is called a credit report. They may do this from one or all of the three major credit reporting agencies. This report will tell the landlord whether your have outstanding debts, or bills that were paid late or not at all, how much credit has been issued to you and how long you have had credit issued to you. The report culminates in a “score” know as your credit score. In short, this score tells the landlord how likely you are pay your bills and whether you will pay them on time. It can range from 300 to 850. For more on how credit works, you can check the articles at HowStuffWorks.com.
Some apartments will require excellent credit (meaning all lines good and a high score, read more on this here) but most are flexible. When an apartment rental runs your credit report the first thing they will be looking for, and what is often most important to them is whether you have a broken lease or money owed to another rental property. Many apartments will discount amounts owed to student loans or medical bills.
If your credit score is outside an apartment’s standard acceptable range, sometimes they will allow you to pay an additional deposit. It is a different story if you still owe money to another property. There are only few a properties that will work you and they are probably not your first choice. To have the most options you may need to make arrangements with the property to either pay it off or start pay off, although apartments will rarely accept this remedy. If you are able to pay off the debt or arrange for payment, you will mostly likely need management of that apartment or rental to verify that to the new apartment or rental.
If you have more questions about how your credit report or credit score will affect your ability to rent, contact us. We do this for a living, and we can help you determine which apartments you are likely to qualify for and even suggest some places that match your criteria that will work with your circumstances.