Is it impossible to get an NYC apartment with imperfect credit?
Question: I’m looking for an apartment, but I don’t have the world’s best credit rating. I plan to use a guarantor, as I do not make 40 times my target rent. If I’m using a guarantor, does any of my financial or credit information even matter, or is it only the guarantor’s information that potential landlords will look at? I’m nervous that my average (or slightly below average) credit score may give me some problems.
— Hoping to land in New York
Dear Hoping:
Would you rent to you?
Signing a lease with a guarantor should be your last resort, not the first. Sure, kids right out of college may need a backstop from the Bank of Mom and Dad, but a full-fledged adult should be able to rent an apartment on his or her own — or at the very least with a roommate or two.
So how do you think a potential landlord will size you up?
As you probably know, credit scores range from an “excellent” score of 850 down to a “bad” rating of 300.
In much of the country, you can probably slip by with a score in the 600s. But in New York, if you come in anywhere south of 700, you’re in for some serious scrutiny.
Anyone in the gray territory had better count on a good employment history, a low pay-to-rent ratio, a clean criminal record and zero evictions.
So how many negative boxes will screeners check when they see you?
A large rental firm will likely hold your history against you. If your problem is just your credit history, then you probably can get in most parts of the city with a guarantor. If you have other negatives, you might find an individual landlord who will take a chance on you, again with a guarantor.
My suggestion? Set your sights a bit lower. Look for a place you can afford on your own. Live there for a year or two. Demonstrate some responsibility. Build up your credit score. Then move up.
David Crook is a veteran journalist and author of The Complete Wall Street Journal Real-Estate Investing and Homeowner’s Guidebooks. Do you have a question about anything real estate-related in NYC? Write him at askus@streeteasy.com. For verification purposes, please include your name and a phone number; neither will be published. Note: Nothing in this column should be considered professional legal advice. If you have a legal issue, consult an attorney.
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