Everyone deserves a place to call their own, and that includes people with no credit or bad credit. If you fall into that category, all hope is not lost! At Coast Tradelines, we are committed to the financial success of every client. The following are some things you can do to improve your credit score for leases involving a new apartment.
1. Open a Credit Line or Two
For individuals unable to lease an apartment due to the fact they have no credit, it’s a good idea to open a credit line or two. Start with a department store card or something similar with a low credit limit. Begin by using this card for your purchases, but be sure you make your payments on time and in full every single month. This will begin to build your credit.
Keep in mind when opening credit lines, you need to space them out effectively. Each time you apply for credit, a hard inquiry will be run on your credit score. That inquiry will pull your score down for a short amount of time, often no longer than 24 months. If you apply for different credit lines within the time that the inquiry is still on your report, it will lower your score each time. Plan to open a second or third line of credit, but be sure you space it out correctly to keep that score up.
2. Know Your Credit Limit and Stay Well Below It
If you have a credit card with an $800 limit, stay well below the $800 mark. The amount of credit you use is called credit utilization. When the leaser you’re working with runs a credit report and sees that you have your credit cards maxed out at all times, they may worry you won’t have the funds to pay your lease each month.
Instead, make small payments throughout the month to keep your debt at a low level. If you have a big purchase coming up and you plan to use your credit card, pay off as much as you can first so it won’t bring you back up to your maximum limit. You could also request a credit limit increase, which will automatically lower your utilization. Lower utilization equals higher credit scores.
3. Keep an Eye on Your Credit
Once per year, each of the three main credit bureaus allow individuals to get a credit report. With this report you can look for errors to be sure there aren’t any bringing your score down. Keeping an eye on your credit gives you a good idea of how well you’re managing it as well. If you see areas in which you can improve, you can make those changes and hopefully see an improvement in your credit score as a result.
4. Utilize Tradelines
Tradelines allow consumers like you to take on accounts as authorized users, though you won’t have access to use the credit lines. This benefits you because the accounts you take on often have long histories of on-time payments and great credit management. Adding these histories to your own history is a great way to boost your credit score, and it’s completely legal.
5. Hang On to Old Debts
It may sound like a bad idea to keep past debts on your credit history, but don’t get too eager to throw them out. If you have past debts that you actually kept up payments on, they can only boost your score. When the negative debts finally get old enough and are removed, those positive debts will get your score back up to where you want it to be. Not only that, but it shows leasers you have a long history of paying on time.
6. Get a Co-Signer
If you have someone you trust who is willing to co-sign with you, his or her ability to make payments on time could begin to look really good for you. If you are unable to make your lease payment, and this person is willing to do it for you, it will help your score grow. Parents often do this for adult children who are just leaving, though almost anyone with good credit can co-sign with someone.
Contact Us Today
If you’re trying to improve your credit score for leases for an apartment, your chances could be pretty high. Contact Coast Tradelines to learn more today at 202-945-9556 or fill in our online form and we’ll be in touch shortly.