What Do Landlords Look For In A Credit Score?
When it comes to choosing a tenant, landlords typically look for three things: rental history, credit score, and income.
Of these three factors, a credit score is often the most important. A good credit score indicates that you’re a responsible borrower who is likely to make rent payments on time and keep up with other financial obligations.
There are a few different things that landlords look for when they’re evaluating your credit score. Here’s a quick overview of the most important factors:
1. Payment History
Your payment history is one of the most important factors in your credit score. It includes information about whether you’ve made your payments on time and in full.
Landlords will want to see that you have a history of making on-time payments, as this is a good indicator that you’ll be able to make rent payments on time in the future.
2. Credit Utilization
Credit utilization is a measure of how much of your available credit you’re using at any given time. Landlords typically want to see a credit utilization ratio of 30% or less, as this shows that you’re using your credit responsibly and not maxing out your credit cards.
3. Length Of Credit History
The length of your credit history is also important to landlords. A longer credit history shows that you’ve been able to manage your finances responsibly over a period of time, which is a good indicator that you’ll be able to do so in the future.
4. Types of Credit
The types of credit that you have can also be important to landlords. A mix of different types of credit, such as revolving credit (e.g., credit cards) and installment loans (e.g., auto loans), shows that you can manage different types of debt responsibly.
5. Credit Inquiries
Credit inquiries are a measure of how often you’ve applied for new credit in the past 12 months. Landlords typically want to see fewer than six inquiries, as this shows that you’re not actively trying to obtain new lines of credit.
Keep in mind that these are just a few of the factors that landlords look at when they’re evaluating your credit score.
Every landlord is different, so it’s important to ask about their specific requirements before you start filling out a rental application.
In general, the higher your credit score, the better your chances of getting approved for a rental. If you have a low credit score, there are still some things you can do to improve your chances of getting approved, such as finding a cosigner or offering to pay a higher security deposit.
With that said, it’s important to remember that your credit score is just one factor that landlords look at when choosing a tenant.
A good rental history and a steady income are also important factors in the decision-making process. So, even if you have a low credit score, there’s still a chance you could get approved for a rental if you have strong rental history and income.
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