When apartments run your credit what are they looking for

January 14, 2021 |9 min read

Your credit scores can be important when you’re looking to rent an apartment. That’s because the landlord or property manager may pull your credit as part of the screening process. Your credit history can show them how you’ve managed money in the past and help them determine whether you might be a responsible tenant.

A credit score in the 600s typically places you in either the “fair” or “good” credit score range and could be a starting point for some landlords and property managers. Meeting their minimum requirements doesn’t necessarily guarantee approval. But knowing what they look for could help you position yourself as a great rental candidate.

How Do Credit Scores Affect Renting?

Your credit scores can influence whether you’ll be approved for a rental lease, says Chris Fluegge, director of operations at the National Landlord Association.

“Each landlord is different, but most landlords and property managers look for a credit score above 600,” Fluegge says. 

FICO® and VantageScore® credit scores typically range from 300 to 850. An applicant with a higher credit score might be considered to have shown a pattern of managing their finances responsibly. And a lower credit score might indicate the potential tenant could struggle to pay rent on time.

Keep in mind that you have multiple credit scores and each is calculated using a different scoring model. Scoring companies like FICO and VantageScore even have different versions of their own scores. So you might see slightly different scores depending on what model was used. 

What Landlords May Look for on Credit Reports

In addition to checking credit scores, landlords also might check a potential tenant’s credit reports. That’s because credit reports can provide a more complete picture of the applicant’s financial history.

“Most landlords understand that a comprehensive credit report is more important than a credit score because it’s a better indicator of a tenant’s payment history,” Fluegge says. “One bad hospital bill or a case of identity theft can send a credit score plummeting. But if that’s the only blemish in a long credit history, the risk is minimized.”

Here are some of the things landlords might look for on a credit report:

• Payment history: Prospective landlords usually look at your payment history from the past 24 months, according to Fluegge. “If landlords can see that a tenant has been consistently paying down their debt, it’s a strong sign that they are responsible enough to pay rent on time every month,” he says. 
• Rental history: Some credit bureaus may include rental history on their credit reports. That can help landlords predict whether applicants will pay rent on time. 
• Collection items and public records: “The things most likely to be deal breakers are usually evictions, unpaid utilities and bankruptcy,” says real estate investor Gabby Wallace. “Most managers are more understanding of debt like student loans, medical bills or credit card debt.”

Keep in mind: If a prospective landlord checks your credit, it could result in a hard inquiry. And hard inquiries can have an impact on your credit scores.

Can You Rent an Apartment With a Low Credit Score?

Credit scores and credit reports are just part of the rental equation. Not all landlords and property managers look at credit scores. And factors other than your credit reports and scores could still help you qualify for an apartment.

Landlords want to make sure potential tenants have enough income to handle rent payments, so they might verify employment. And according to the Consumer Financial Protection Bureau, landlords and property managers might do a background check using a tenant-screening agency. Both employment verification and background checks can be important factors in whether an applicant is approved.

“If the [credit] score is close but not quite there, I would look at the application as a whole,” Wallace says. “For example, a stable income and clean background report help.”

Ways to Help Improve Credit Scores

Credit scores can change over time. Here are a few ways you can show responsible credit use and help improve your credit:

• Pay on time. According to both FICO and VantageScore, your payment history can be a significant factor in determining your credit scores. You could use email reminders or calendar alerts to help you pay on time. And setting up automatic payments can ensure you don’t miss a payment due date.
• Pay more than the minimum. Making only your credit card minimum payments comes with a cost: interest charges. Interest can add up, cost you more money in the long run and even make it harder to pay off debt. So consider this from the CFPB: “Paying off your balance each month can help you get the best scores.”
• Keep your balances low. The CFPB recommends that you not spend more than 30% of your available credit. A low credit utilization ratio—a measure of how much of your available credit you’re using—could be a sign that you’re using your credit responsibly and not overspending. And that could help you improve your score.
• Apply only for the credit you need. “Credit scoring formulas look at your recent credit activity as a signal of your need for credit,” explains the CFPB. “If you apply for a lot of credit over a short period of time, it may appear to lenders that your economic circumstances have changed negatively.”

Check Your Credit Score With CreditWise From Capital One

According to a TransUnion study, checking your credit score can potentially lead to more positive credit behavior. About one-third of consumers in the study who monitored their credit were able to increase their credit score over the course of a year. 

One way to monitor your credit is by using CreditWise from Capital One. With CreditWise you can access your free TransUnion credit report and weekly VantageScore 3.0 credit score anytime—whether you’re a Capital One customer or not. And it won’t hurt your credit score. 

You can also get free credit reports from each of the three major credit bureaus. Visit AnnualCreditReport.com to learn how. 

Your credit is just one factor that landlords use to determine whether to accept you as a tenant. But it’s an important one. Knowing what they look for can help you figure out where you could improve.

When an apartment runs your credit what do they see?

What type of credit do apartments look for?

Can I get an apartment with a 500 credit score?

Is apartment credit check hard?