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Thread: Renting a home with bad credit

  1. #1
    buffie06
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    Default Renting a home with bad credit

    My husband and I currently own our home and want to relocate and downsize. We don't want to own a home for awhile for several reasons. We want to start renting, but are with a debt condolidation co. and our credit is shot as a result. We have always owned our homes and never even rented anything before. We need to find a place by December. We are looking now, but do we tell people we cant move in until December, is it too late or soon? Also with our bad credit how realistic is it we can rent and/or what might we offer as a substiute to prove we can and will meet our obligations?

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    Banned Melonie's Avatar
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    Default Re: Renting a home with bad credit

    ^^^ a lot depends on whether your potential new landlord is corporate managed or a private owner. Undoubtedly any corporate managed arrangement is going to result in a credit check ... at which point your credit counseling history will probably be treated the same as if you had gone bankrupt. However, a 'mom & pop' situation probably won't be as stringent, and are likely to be swayed by extra cash if a question of your terrible credit rating does come up.

    Yes definitely tell people that you are looking for a December 1st move-in date.

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    Banned Katrine's Avatar
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    Default Re: Renting a home with bad credit

    I second on the mom and pop houses

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    Default Re: Renting a home with bad credit

    It is super hard to rent here with bad or no credit. I have No credit and I wasn't able to find anything at all. I am sure if you have a few months rent saved up that it would help quite a bit to pay it up front or show them your bank statement. At least that way they know you are going to pay!

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    Banned Melonie's Avatar
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    Default Re: Renting a home with bad credit

    I am sure if you have a few months rent saved up that it would help quite a bit to pay it up front or show them your bank statement. At least that way they know you are going to pay!
    this is arguably true of 'mom and pop' landlords.

    However, it is NOT necessarily true of corporately managed apartments. The fact that a would-be new tenant is able to pay an extra month or two worth of rent up front in cash, or the fact that a would-be new tenant has money in the bank right now, provides absolutely no guarantee that the same person will be willing / able to pay rent on time a year in the future. Late rent payments cost the corporate landlord profits. Very late rent payments leading to eviction cost the corporate landlord legal fees on top of lost profits on top of additional costs to clean up after the old tenant and find a new tenant. Thus corporate landlords set great stock in the 'payment history' portion of a would-be tenant's credit report. From that standpoint, corporate landlords will almost always select a new tenant with a good payment history versus a new tenant with a rotten payment history that offers a bit of extra cash up front.

  6. #6
    AudreyLeigh
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    Default Re: Renting a home with bad credit

    You may end up having to move into an apartment or townhome community. I have poor credit with a 2 year old Ch 7 and no rental history.

    My first place I needed a cosigned with an extra months rent as security. Instead of $550 sec dep it was $1600.

    But my new place I got into no problem with the minimal down payment $450.

    When I was looking to move from my first place I went with mom and pop because i wanted a house and thought theyd be less invasive and easier to deal with. they ended up being more work and hassle. They wanted WAY more info than prop management and they were like gathering applications to pick the "right" tenant and with my Ch 7 I was on the bottom of the list. So Im out paying all these app fees and having all these credit checks done for nothing. Did that for 3 weeks and gave up and went to a townhouse community... they put all my info in some computer program and was approved on the spot. No problems.

    Most likely youll just end up with a higher security deposit at a prop management or apartment homes. And different places have different standards.

    My 1st apartment was in the GHETTO and they were harder on me than this place which is $600 more a month and in a way nicer area. Go figure... I thought it would be the other way around...if I would have known I would have gone to the nicer place first!!!

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    God/dess FrustratedBunny's Avatar
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    Default Re: Renting a home with bad credit

    I rented both a house and an apartment with a bankruptcy. The first one just asked me to explain my bankruptcy and the second didn't care.

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    Default Re: Renting a home with bad credit

    corporate apartment communities are under pressure to fill 90 percent or more of their units. if the complex has 80-85 percent or even less of its units filled, then you can have the crappiest credit and probably get in all right. they'd rather take the chance to get their numbers up (their bonuses and salary and jobs depend on that sort of thing) than turn down someone with a valid bank account and willingness to pay.

    so i would actually honestly say to try the megacomplexes and emphasize your ready funds. they have a line on the form 'other sources of income', pretty much for people who don't earn paychecks, but have enough to pay regular on an apartment.

  9. #9
    Kaylinn
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    Default Re: Renting a home with bad credit

    about apartment complexes
    ( well, mine anyway.Which is owned by a large corporation)

    They run a credit report, but it doesn't actually list your credit. It justgives you a grade( a,b,c) and lists rental recommendations. No security deposit, half deposit, 2 months deposit..whatever.

    However.
    The property manager has the authority to ovverride these recommendations, and set whatever rules she wants.

    I know this because when my boyfriend and I lost our house and moved into this apartment complex, his credit and mine were completly trashed. It was "recommended" that we pay not only first and last months rent, but an additional $600. The total would have been over 3grand

    We explained to the manager that we had lived there before a few years ago, and if she could pull up our history, she would see we were never late on our rent, we lost our house due to health problems I had and couldn't work, that's why we are downsizing, blah blah.

    She ended up letting us move in for only $300. total.
    Our first months rent was $300, and that was the "move in cost" She waived security depost, cleanign fees and all other bullshit.
    That's how I learned she could override, and do whatever she wanted.

    So....
    This might not apply everywhere, but this was my experience, and it's worth looking into.
    Explaining your situation, why you had hardship in the past, and why and how yoru able to pay the rent now. (with proof)

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    Default Re: Renting a home with bad credit

    corporate apartment communities are under pressure to fill 90 percent or more of their units. if the complex has 80-85 percent or even less of its units filled, then you can have the crappiest credit and probably get in all right.
    This is definitely true. However, keep in mind that the people being displaced by foreclosure of their overmortgaged homes are also entering the rental market right now. In cities where the 'real estate bubble' was fairly big, there is beginning to be a flood of people with terrible credit / bankruptcies seeking to rent apartments. This is making corporate landlords a lot more nervous than they used to be about the ability / willingness of new tenants with poor credit ratings to pay their rent.

    I have seen figures like 1 in 8 subprime homeowners already being in some stage of the foreclosure process. With subprime comprising perhaps 1/3rd of all home mortgages, and with homeowner families comprising about 50% of total population, this means that for every 1000 families living in a given city that an extra 21 of them will be forced to become renters within the next three months. If renters comprise the other 50% of total population, this will automatically increase rental occupancy rates by an extra 4.2%. As more and more subprime mortgage defaults continue to occur as a result of ARM interest rate resets through next spring, these numbers could double within the next six months and easily exceed the available supply of rental properties.

    The corporate landlords know that, in most states, once they let a new tenant in that state renters laws basically allow that new tenant a 2-3 month 'free ride' if they decide not to pay rent and the landlord must go through the eviction process. Also, new tenants with an impending bankruptcy or a fresh bankruptcy on their record have essentially nothing additional to lose from a credit rating standpoint by attempting to take that 2-3 month 'free ride'. This in turn is resulting in landlords requiring ever higher security deposits on top of advance month rent payments up front.

    You may also want to consider signing on to a lease arrangement which will lock in your monthly rent payment for 6 months or a year. The reason of course is that once the impending foreclosed / bankrupt subprime homeowners start looking for rental units in large numbers such that landlords will have no problems achieving 90%+ rental occupancy rates, it's virtually assured that rental costs will be raised. The pressure to raise rents will also be compounded by the large increases in property taxes now going into effect in many areas, rising energy costs etc.

    It's also speculated that the best 'deal' that will soon be available will be the rental of a house from a 'trapped' investor or from a 'trapped' homebuilder / developer. These outfits are skirting bankruptcy themselves and in many cases they have now given up on the idea of selling their investment properties at a big loss. Instead they hope to achieve enough cash flow by renting out the property to stave off their own bankruptcy while waiting for real estate values to rise again allowing the house to again be sold at a profit. The risk in going this route though is that if the 'trapped' investor / homebuilder / developer is forced into bankruptcy, you will probably be forced out of your rented house.
    Last edited by Melonie; 10-27-2007 at 05:51 AM.

  11. #11
    buffie06
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    Default Re: Renting a home with bad credit

    An apartment or townhome is not an option, I have 2 large dogs. Also, I am one of the people who is downsizing due to my ARM increase, so I am screwed

  12. #12
    BrunetteGoddess
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    Default Re: Renting a home with bad credit

    We will be in the same boat as you when R gets a job elsewhere. We just got a discharge on our Chapter 7 and have 2 big dogs and a cat, so apartments are not an option.

    I will be watching this thread.

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    God/dess FrustratedBunny's Avatar
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    Default Re: Renting a home with bad credit

    some apartment complex management companies have a "no bankruptcy within the past two years" rule. At least all the ones I seemed to call in Pensacola did that were run by a certain company.

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    Default Re: Renting a home with bad credit

    renting sucks in Pcola..i live here and had to put down 2 months plus sec.dep. seems almost everybody wants good credit here, im trying to rent a house too. been turned down twice.

  15. #15
    AudreyLeigh
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    Default Re: Renting a home with bad credit

    Quote Originally Posted by FrustratedBunny View Post
    some apartment complex management companies have a "no bankruptcy within the past two years" rule. At least all the ones I seemed to call in Pensacola did that were run by a certain company.
    This would explain why it was easier to get into the 2nd place. My ch 7 had been 2 years. The other it had only been 1.

    Quote Originally Posted by Kaylinn
    However.
    The property manager has the authority to ovverride these recommendations, and set whatever rules she wants.
    Or maybe this because i got along with her really well and she liked me. Im now always stopping by the office and chatting with her. Ive actually thought about asking her if she wants to go out for drinks..

  16. #16
    PhillyDancer1982
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    Default Re: Renting a home with bad credit

    Quote Originally Posted by Xiomara View Post
    renting sucks in Pcola..i live here and had to put down 2 months plus sec.dep. seems almost everybody wants good credit here, im trying to rent a house too. been turned down twice.
    You live in Pensacola? Cool. I have an ex-boyfriend(if you can call him that) that lives down there. He's in training for the Navy. He keeps telling me to visit him LOL but I'd rather wait until he comes up home to Philly for New Years(cheaper that way and I won't have to miss work).

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