We get this question a lot from potential clients about the rental history report, so let's run down a few things to consider therein.
What's typically on a rental history report?
It might vary a little bit geographically, but usually the factors on a rental history report will include:
- Credit score
- Past rental history
- Any evictions, late payments, etc.
- Criminal background
- How much you paid in rent previously
- Any comments from landlords
Now, two of these elements are currently somewhat "in flux," in that we're all getting new FICO scores. Admittedly, most of the impact of these scores won't be felt until late 2021. They are adding a "resiliency index" so that delinquent payments won't mean as much.
The number one thing to focus on between now and then is paying down as much credit card debt as possible, even if that means making frequent payments throughout a given month. Consistently high statement balances, or consistently-rising statement balances, are the biggest FICO red flag of financial difficulty, and that’s only going to be more harsh for people under the 10-level scores.
Do not necessarily get new credit, but if you have old credit accounts that you’re paying down, you can keep those open. Why? They contribute to a factor of FICO called “credit utilization,” which is a relatively large scoring factor; they also contribute to “credit age,” which is a smaller scoring factor but something important nonetheless.
The gold standard still applies: key credit balances low and pay your bills on time. That will always help your FICO.
The other shifting element of rental history reports is evictions, because the picture around COVID and evictions is much more drastic than "normal times." We're not by any means saying that being evicted is a good thing, but a COVID eviction tied to a layoff or furlough will likely not be scored the same way by a prospective future rental complex.
What if you don't have rental history?
Good question. Typically in this case, you'll need some of the following:
- Proof of income
- Bank statements
- Tax returns
- Someone to help you co-sign or be a guarantor
- A letter explaining your lack of rental history
- A letter from employers or multiple contract gig letters
- Personal references
What if your rental history and background is bad? Should you fudge reality?
No, because complexes will be able to find out based on your identifying details.
There are ways to increase your credit score instantly, i.e. Experian Boost, which helps your rental history. You can also do some of the things a first-time renter would do: write letters explaining different situations, get personal references, or secure someone that can be a "back-up" for you in case of rent issues, which can sometimes comfort the complex you'll be renting from.
Sites like Avail can help you with rental history improvements too.
WikiHow also has a 14-step guide to improving your rental history, most of which is rooted in getting a copy of your potential rental history report before you even begin a new search. Those are available from most credit providers and some third-party outlets. We can also help you secure a look at your rental history and then work through it with you.
Is it impossible to get an apartment with a questionable rental history?
Impossible? No. Harder? Yes. But we can work with you on different angles and approaches to try and get you the best possible complex for your current needs. Just let us know.