Find a Rental Even When You Have Not-so-Great Credit

There is a chance if you are looking for a rental right now, perhaps it is due to a recent distressed property sale or other unfortunate circumstances. This is very common and will become even more so in 2012 as more people are granted the ability to short sale their home or as the market goes through more foreclosures.

Here are some tips to help find a new rental residence to call home: 

1. Once you are ready to move forward, find out your credit scores to see where you stand. If looking for a rental, have it run once by the realtor or property management company you are working with. Do not go from place to place having people run your credit, this could hurt your scores, do it once or twice if possible within a short amount of time. It is possible the landlord will want to run it as well, this is common.
2. Prepare a letter stating your circumstances and explaining why your credit is such. If it is due to a short sale or foreclosure but you have kept up on all other financial obligations, as is shown on your credit report, this says something to the landlord, and shows them you may not be a bad credit risk.
3. Save your money, and make sure you can offer a larger than usual deposit, if needed. Offering say three to six months of the rent upfront will help give some sense of security to your landlord and is a possible negotiation tool to get you the place. When competing with others who have 700-plus credit scores, there needs to be a compelling reason to accept your application over others.
4. Keep an open mind. You may be used to having a large home and as such want to continue this lifestyle, but because this is a rental, it is not forever. If you want to get back into the real estate market one day, get a rental, pay on time and keep up on all other financial obligations. It may take three to seven years, depending on your circumstances, but keep your eye on the prize, the rental is there to help you get to your next chapter in life.
5. Compile the following items, if requested, with your rental application: proof of income (copy of your current bank statement), proof of employment (copies of your most recent pay stubs from work), a list of local references (make sure to let those people know they may get a call).

If you have good credit and no late pays or short sales in your history, the rental market is your oyster. One thing to consider, though, is how rental prices compare to what a possible mortgage payment would be. Some gains may be had if you are lucky enough to be in this position in our current market.

Good luck and happy new year!