Building Your Credit to Secure Your Dream Apartment Rental

When searching for the perfect apartment to call home, a strong credit history can make all the difference between a smooth rental application process and facing potential obstacles. Landlords and property managers often use credit scores to assess an applicant's financial responsibility and ability to meet rental obligations. Therefore, it's essential to build up your credit before embarking on your apartment hunt. In this blog post we learned from MOMS, Multiple Option Mortgage Services,  practical steps to improve your credit and increase your chances of securing that dream apartment rental.

Check Your Credit Report:

The first step in building your credit is to know where you stand. Request a free copy of your credit report from each of the major credit bureaus (Equifax, Experian, and TransUnion) and review it carefully. Look for any errors or discrepancies and dispute them if necessary. Understanding your credit history will help you identify areas for improvement. To learn more about how to obtain a copy of your credit report follow this link, or click here to request your free credit report today. 

Keep it simple: 

Only apply for credit when necessary and do so responsibly. You can create and keep strong credit without having many lines of credit. Generally, 1-2 is all that would be necessary. Opening fewer accounts makes everything easier to keep track of. 

Don’t rush to close old accounts: 

Age of accounts matters for credit scores. Older accounts that aren’t used can keep scores higher simply because they have been open for longer. 

Revolving debt is key: 

Currently, scoring models place much more weight on revolving (credit card) debt than other kinds of debt. Having a credit card that is paid on time and maintained at a low balance (between 0% and 10%) offers the best support for credit scores. 

Reduce Credit Card Balances:

High credit card balances relative to your credit limit can negatively affect your credit score. Aim to keep your credit utilization below 10% to demonstrate responsible credit management. Pay down outstanding credit card debts as much as possible, starting with those with the highest interest rates.

No late payments: 

Stating the obvious but paying accounts on time is crucial to keeping strong credit. Even if you have past lates, getting caught up and stopping late payments is always the first step. Credit improves gradually as you get further from your last late payment, any new ones can restart the clock. Set up reminders or automatic payments for your rent, utilities, credit cards, and any other debts. 

Avoid cosigning on debts:

Cosigning for family and friends can be a generous way to help them accomplish their goals. Strictly from a credit standpoint it can open you up to risk from accounts that you do not actually want any responsibility for. If you feel like you must cosign for someone, always make sure to monitor the account and be prepared to help make a payment if it is going to be late.

Credit doesn’t have to be repaired in a day:

Sometimes, there are simple changes that can be made which result in large improvements to credit immediately. In many cases, however, credit improvement takes some time. Saving and paying down debt is a process, as some debt is removed it allows for more savings and further, faster improvements down the line. Make a plan and stick to the course.

Establish a Credit History:

If you're new to credit or have a limited credit history, consider opening a secured credit card or becoming an authorized user on a family member's or friend's account. Responsible use of these accounts will help you establish a positive credit history over time.

Some collections can be deleted:

Collections can be deleted, not in every case or by every company but it never hurts to ask. Any time you pay a collection be sure to request it be deleted instead of marked as paid, the difference in the two is significant for your scores. It is also suggested to ask for proof in writing of the updated account status. Sometimes collection companies aren’t the best at updating credit bureaus.

Diversify Credit Types:

A diverse credit mix can positively impact your credit score. Alongside credit cards, consider diversifying your credit portfolio with installment loans, such as a personal loan or a car loan. However, only take on new credit when you can comfortably manage the payments.

Monitor Your Credit Regularly:

Keep a close eye on your credit by regularly checking your credit score and monitoring any changes. Many websites and apps, and sometimes even your bank, offer free credit monitoring services that notify you of any significant changes to your credit report.

Work with a professional:

Working on credit can be a daunting task. When you work with the MOMS Team you have somebody to help you make a plan, and to support and encourage you along the way. Through ups and downs we have experience in guiding you through your credit journey. As with anything, working with a team is easier than going alone.

Building up your credit is a gradual process that requires responsible financial management and patience. A strong credit history not only increases your chances of renting your dream apartment but also opens doors to better financial opportunities in the future. Start implementing these strategies today, and watch your credit score steadily rise, putting you in a favorable position to secure your ideal apartment rental.

Remember, building credit is about establishing good habits and maintaining financial discipline, leading to a brighter and more secure financial future. Happy apartment hunting!

(Note: The information provided in this blog post is for educational purposes only and does not constitute financial advice. Be sure to consult with a qualified financial advisor or credit counselor for personalized guidance.)

For qualified and expert guidance, please reach out to MOMS, Multiple Option Mortgage Services. NMLS# 57052

Call: (502)473-1817

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