What Credit Score Do You Need to Rent an Apartment?

When it comes to your credit score, the higher, the better – especially when you’re hunting for a new rental apartment. Having a high credit score in the “very good” to “excellent” range shows landlords you’re financially trustworthy based on your borrowing history and are more likely to pay your rent on time.

One of the most common ways to build credit is by using a credit card for everyday spending. Utilizing credit and paying off the balance in full each month shows you can reliably pay off your debts. Of course, credit cards have to be used responsibly to benefit your credit score. Here are three key ways to boost your credit score to help catch that dream apartment.

Pay your bills on time

Payment history accounts for roughly 35% of how your credit score is calculated, making it the most important way to build and maintain a high credit score. This means paying your bills before their stated due dates every single month, no matter how you go about reminding yourself: through your banking or budgeting app, email or calendar reminders, or a note on your fridge.

Pay your bills on time

If you’re struggling with paying off your balance in full each month, low-interest credit cards offer interest rates in the single digits – about half of what rewards credit cards typically charge. This makes it easier to keep on top of your monthly payments. Many low-interest credit cards also offer promotional interest rates on balance transfers, allowing you to pay off existing credit card debt at a much lower rate for a fixed period.

Choose the best credit card for your needs

Credit cards are a useful financial tool for building good credit, but signing up for one of the best credit cards can also help you unlock access to a number of benefits including rewards points that can be redeemed for travel, merchandise, and gift cards, cash back on every dollar you spend, and extra perks such as travel insurance and rental car coverage – a must if you’re planning to rent a van for moving day.

If you don’t use your credit card for everyday spending, make sure to at least use it occasionally, so it’s not marked inactive or closed. Another thing to consider: the length of your credit history and the amount of credit you have access to are other vital components of your credit score, so cancelling older credit cards may temporarily ding your score.

Don’t max out your credit cards

Spending dangerously close to your credit limit is not a good look for your bank account or your credit score. Your credit utilization ratio – how much credit you’re using vs. your total credit limit – signals how in control of your finances you are. A maxed-out credit card is a sign you’re overleveraged and/or financially irresponsible. In general, it’s recommended you keep your credit utilization ratio below 30% of your available credit limit. For example: if your credit limit is $2,000, your balance shouldn’t be higher than $600 at any given time.

Don't max out your credit card

Paying interest every month also devalues any rewards you’re earning, so using cash back credit cards and travel credit cards is no good if you’re not paying off your balance in full every month.

The bottom line

Using a credit card is a straightforward way to build good credit. As a renter, it’s also one of the easiest ways to establish and maintain a strong credit history. Having a high credit score is one of the best ways to stand out in a competitive rental market and signals to potential landlords that you’ll be a trustworthy tenant.

Write Your Comment

You may use these HTML tags and attributes:
<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Join our newsletter

What is Rentberry?

Rental Service

Rentberry unites landlords and tenants to make their rental experience fair, secure and transparent.

Price Negotiation Platform

Affordable rent is not a myth. Negotiate the final price with your potential landlord and find a common ground together.

Time-Saving Tools

Having your whole rental experience in one place is real. Sign electronic agreements and rent a perfect place in a few clicks.