You already know that having a bankruptcy on your credit report will affect your ability to finance a car or get a mortgage on a house. But can it keep you from renting an apartment? Unfortunately, it might. A survey conducted by one of the major credit reporting bureaus shows that almost one in two landlords named the credit check one of the top three things they used to make a decision about whether to rent to a specific tenant. So how can you get approved to rent an apartment when you have a bankruptcy sitting on your record? Take a look at some tips that can help you get your lease application approved.
Rely on Your Rental History
If you've been a great tenant in the past, your credit history may not matter as much. After all, a landlord doesn't care if you get behind on your student loans, credit card payments, or medical bills. All the landlord is worried about is getting their rent in a timely fashion. So if you have a great rental history, a new landlord might be willing to overlook the bankruptcy.
Contact your previous or current landlords and make sure that they're willing to give you a glowing reference. When you meet with your prospective landlord, you should make sure to specifically point out that your rental history is good and that you have references that can back you up.
You're going to have to address the issue of your bankruptcy head-on if you want to be able to rent. If you don't mention the bankruptcy before your landlord does a credit check, there's a good chance that they'll just deny your application. But if you bring it up ahead of time, you'll have a chance to tell your story and set the tone for the conversation about your credit history.
If your bankruptcy was recent, make sure to point out that with all the old debts and payments out of the way, you're now in a perfect position to make sure that your bills get paid on time. You have more disposable income than you did when you were trying to pay off mountains of debt. If the bankruptcy was several years ago, then make it a point to explain what you've been doing to rebuild your credit and manage your finances responsibly. Pull your own credit report so you know what it says, and point out accounts in good standing that have been opened since your bankruptcy was completed.
By bringing up the bankruptcy yourself, you're taking the opportunity to show why you'd be a good renter in spite of the bankruptcy. You may also save yourself some money this way – if the landlord absolutely won't consider you due to your credit history, at least you'll know it before you pay a non-refundable credit check fee for that apartment.
Offer Something More
You may have to offer more than other tenants if you want to have your lease application approved. For example, a landlord might be swayed if you offer to pay a higher security deposit. Consider offering to pay double the normal security deposit. Or, if you have the cash on hand, offer to pay several months of rent in advance. Your credit rating and bankruptcy status matters a lot less if you can pay several months of rent up front, because your landlord won't have to worry about whether or they'll get paid in those months, and you'll have plenty of time to save up for when your prepayment runs out.
Another thing that you can offer is a co-signer on the lease. Getting someone who is financially secure to cosign for you can ease a landlord's worry that you may not be financially secure yourself. However, use this strategy with extreme caution. If something does happen to make you unable to pay the rent, you risk losing your relationship with the co-signer when they are forced to pay your rent or risk a black mark on their own credit rating.
The best thing that you can do is be proactive about improving your credit after a bankruptcy. You can raise your credit score, even during the time that a bankruptcy shows on your credit report. Talk to your bankruptcy attorney about ways to improve your credit that fit your individual financial situation.